A Theory of Rational Choice under Ignorance

Theory and Decision 48 (3):205-240 (2000)
Abstract
This paper contributes to a theory of rational choice for decision-makers with incomplete preferences due to partial ignorance, whose beliefs are representable as sets of acceptable priors. We focus on the limiting case of `Complete Ignorance' which can be viewed as reduced form of the general case of partial ignorance. Rationality is conceptualized in terms of a `Principle of Preference-Basedness', according to which rational choice should be isomorphic to asserted preference. The main result characterizes axiomatically a new choice-rule called `Simultaneous Expected Utility Maximization'. It can be interpreted as agreement in a bargaining game (Kalai-Smorodinsky solution) whose players correspond to the (extremal) `acceptable priors' among which the decision maker has suspended judgment. An essential but non-standard feature of Simultaneous Expected Utility choices is their dependence on the entire choice set. This is justified by the conception of optimality as compromise rather than as superiority in pairwise comparisons
Keywords Ignorance  Ambiguity  Multiple priors  Rational choice  Incomplete preference  Robustness  Independence  Sure-thing principle  Context-dependence  Choice consistency
Categories (categorize this paper)
Options
 Save to my reading list
Follow the author(s)
My bibliography
Export citation
Find it on Scholar
Edit this record
Mark as duplicate
Revision history Request removal from index
 
Download options
PhilPapers Archive


Upload a copy of this paper     Check publisher's policy on self-archival     Papers currently archived: 10,330
External links
Setup an account with your affiliations in order to access resources via your University's proxy server
Configure custom proxy (use this if your affiliation does not provide a proxy)
Through your library
References found in this work BETA

No references found.

Citations of this work BETA
Diego Lanzi (2010). Embedded Choices. Theory and Decision 68 (3):263-280.
Similar books and articles
Analytics

Monthly downloads

Added to index

2010-09-02

Total downloads

6 ( #195,517 of 1,096,585 )

Recent downloads (6 months)

1 ( #258,571 of 1,096,585 )

How can I increase my downloads?

My notes
Sign in to use this feature


Discussion
Start a new thread
Order:
There  are no threads in this forum
Nothing in this forum yet.