Abstract
To disobey expected utility theory is to behave inconsistently because of framing illusions. Any other decision procedure would
###“be inconsistent in the sense that it violated the laws of preference between options … If anyone’s mental condition violated these laws, his choice would depend on the precise form in which the options were offered him, which would be absurd”. Ramsey 1950, p.182.
In 1952 Allais tested this claim at an international colloquium on risk in Paris by asking Savage to choose between some simple options, and then proceeded to convince him that his answers disobeyed expected utility theory. Surely, said Allais, Savage would choose consistently between simple options and therefore his answers disconfirmed Ramsey’s claim.
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Pope, R. (1986). Consistency and Expected Utility Theory. In: Daboni, L., Montesano, A., Lines, M. (eds) Recent Developments in the Foundations of Utility and Risk Theory. Theory and Decision Library, vol 47. Springer, Dordrecht. https://doi.org/10.1007/978-94-009-4616-3_14
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DOI: https://doi.org/10.1007/978-94-009-4616-3_14
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