Abstract
The conjunction of utility theory and decision theory involves formulations of decision making in which the criteria for choice among competing alternatives are based on numerical representations of the decision agent’s preferences and values. Utility theory as such refers to those representations and to assumptions about preferences that correspond to various numerical representations. Although it is a child of decision theory, utility theory has emerged as a subject in its own right as seen, for example, in the contemporary review by Fishburn (see REPRESENTATION OF PREFERENCES). Readers interested in more detail on representations of preferences should consult that essay.
This is a preview of subscription content, log in via an institution to check access.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
Preview
Unable to display preview. Download preview PDF.
Bibliography
Allais, M. and Hagen, O. (eds) 1979. Expected Utility Hypotheses and the Allais Paradox. Dordrecht: Reidel.
Arrow, K.J. 1974. Essays in the Theory of Risk Bearing. Amsterdam: North–Holland.
Bawa, V.S. 1982. Stochastic dominance: a research bibliography. Management Science 28, 698–712.
Bernoulli, D. 1738. Specimen theoriae novae de mensura sortis. Commentarii Academiae Scientarium Imperalis Petropolitanae 5, 175–92. Trans. L. Sommer, Econometrica 22, (1954), 23–36.
Chipman, J. S. 1973. The ordering of portfolios in terms of mean and variance. Review of Economic Studies 40, 167–90.
Ellsberg, D. 1961. Risk, ambiguity, and the Savage axioms. Quarterly Journal of Economics 75, 643–69.
Fishburn, P.C. 1970. Utility Theory for Decision Making. New York: Wiley.
Fishburn, P.C. 1973. The Theory of Social Choice. Princeton: Princeton University Press.
Fishburn, P.C. 1974. Lexicographic orders, utilities, and decision rules: a survey. Management Science 20, 1442–71.
Fishburn, P.C. 1981. Subjective expected utility: a review of normative theories. Theory and Decision 13, 139–99.
Fishburn, P.C. 1982a. The Foundations of Expected Utility. Dordrecht: Reidel.
Fishburn, P.C. 1982b. Nontransitive measurable utility. Journal of Mathematical Psychology 26,31–67.
Fishburn, P.C. 1986. The axioms of subjective probability. Statistical Science 1, 335–45.
Hicks, J. R. and Allen, R.G. D. 1934. A reconsideration of the theory of value, I, II. Economica 1, 52–75, 196–219.
Houthakker, H.S. 1961. The present state of consumption theory. Econometrica 29,704–40.
Hurwicz, L. and Richter, M.K. 1971. Revealed preference without demand continuity assumptions. In Preferences, Utilit, and Demand, ed. J.S. Chipman, L. Hurwicz, M.K. Richter and H.F. Sonnenschein, New York: Harcourt Brace Jovanovich.
Kahneman, D. and Tversky, A. 1979. Prospect theory: an analysis of decision under risk. Econometrica 47, 263–91.
Libby, R. and Fishburn, P.C. 1977. Behavioural models of risk taking in business decisions: a survey and evaluation. Journal of Accounting Research 15, 272–92.
Loomes, G. and Sugden, R. 1982. Regret theory: an alternative theory of rational choice under uncertainty. Economic Journal 92, 805–24.
Luce, R.D. and Raiffa, H. 1957. Games and Decisions. New York: Wiley.
Machina, M.J. 1982. ‘Expected utility’ analysis without the independence axiom. Econometrica 50, 277–323.
Markowitz, H. 1959. Portfolio Selection. New York: Wiley.
Mas–Coiell, A. 1974. An equilibrium existence theorem without complete or transitive preferences. Journal of Mathematical Economics 1, 237–46.
Nash, J. 1951. Non–cooperative games. Annals of Mathematics 54, 286–95.
Pratt, J.W. 1964. Risk aversion in the small and in the large. Econometrica 32, 122–36.
Raiffa, H. and Schlaifer, R. 1961. Applied Statistical Decision Theory. Boston: Division of Research, Graduate School of Business, Harvard University.
Ramsey, F.P. 1931. Truth and probability. In The Foundations of Mathematics and other Logical Essays, ed. R.B. Braithwaite, New York: Harcourt, Brace,
Reprinted in Studies in Subjective Probability, ed. H.E. Kyburg and H.E. Smokier, New York: Wiley, 1964,61–92.
Savage, L.J. 1954. The Foundations of Statistics. New York: Wiley. 2nd rev. edn, Dover Publications, 1972.
Schmeidler, D. 1984. Subjective probability and expected utility without additivity. Reprint no. 84, Institute for Mathematics and its Application, University of Minnesota.
Sen, A. 1977. Social choice theory: a re–examination. Econometrica 45, 53–89.
Shafer, W. and Sonnenschein, H. 1975. Equilibrium in abstract economies without ordered preferences. Journal of Mathematical Economics 2, 345–8.
Slovic, P. and Lichtenstein, S. 1983. Preference reversals: a broader perspective. American Economic Review 73, 596–605.
Sonnenschein, H.F. 1971. Demand theory without transitive preferences with applications to the theory of competitive equilibrium. In Preferences, Utility and Demand, ed. J.S. Chipman, L. Hurwicz, M.K. Richter and H.F. Sonnenschein. New York: Harcourt Brace Jovanovich, 215–23.
Stigler, G.J. 1950. The development of utility theory: I, II. Journal of Political Economy 58, 307–27, 373–96.
Tobin, J. 1965. The theory of portfolio selection. In The Theory of Interest Rates, ed. F.H. Hahn and F.P.R. Brechling, New York: Macmillan, 3–51.
Uzawa, H. 1960. Preference and rational choice in the theory of consumption. In Mathematical Methods in the Social Sciences, 1959, ed. K.J. Arrow, S. Karlin and P. Suppes, Stanford, California: Stanford University Press, 129–48.
von Neumann, J. and Morgenstern, O. 1944. Theory of Games and Economic Behavior. Princeton, NJ: Princeton University Press. 2nd edn, 1947; 3rd edn, 1953.
Whitmore, G.A. and Findlay, M.C. (eds) 1978. Stochastic Dominance. Lexington, Mass.: Heath.
Winkler, R.L. 1972. An Introduction to Bayesian Inference and Decision. New York: Holt, Rinehart and Winston.
Editor information
Copyright information
© 1990 Palgrave Macmillan, a division of Macmillan Publishers Limited
About this chapter
Cite this chapter
Fishburn, P.C. (1990). Utility Theory and Decision Theory. In: Eatwell, J., Milgate, M., Newman, P. (eds) Utility and Probability. The New Palgrave. Palgrave Macmillan, London. https://doi.org/10.1007/978-1-349-20568-4_40
Download citation
DOI: https://doi.org/10.1007/978-1-349-20568-4_40
Publisher Name: Palgrave Macmillan, London
Print ISBN: 978-0-333-49541-4
Online ISBN: 978-1-349-20568-4
eBook Packages: Palgrave Economics & Finance CollectionEconomics and Finance (R0)