Reconciling Savage’s and Luce’s modeling of uncertainty: The best of both worlds

Chai, Junyi; Li, Chen; Wakker, Peter P.; Wang, Tong V.; Yang, Jingni

doi:10.1016/j.jmp.2015.10.007

Cited by 7 publications

(2 citation statements)

References 42 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…As pointed out by Peter Wakker, the strength of preference is another way of saying preference intensity. For related literature, one can see Chai et al's theoretical treatment [26], "axiomatizations that use the strength of preference as primitive are less appreciated than axiomatizations that only use preference".…”

Section: Introductionmentioning

confidence: 99%

A Behavioral Foundation of Satiation and Habituation

Chai

2023

Mathematics

Self Cite

View full text Add to dashboard Cite

Tastes change over time. People’s tastes are distorted through two channels: satiation formation and habit formation. In this paper, we develop a theoretical foundation of satiation and habituation by an axiomatic approach. Our theory is based on a hierarchy of preference conditions called compensation independence. The behavioral assumption underlying the preference conditions are the psychological compensation of human beings. I flesh out an axiomatic system for general models of satiation and habit formation, which contains many functional forms in the literature as special cases. Moreover, I advance the axiomatization to accommodate the linear representations of satiation and habit formation that are prevailing in the literature. This paper contributes to the birth of a new generation of the behavioral foundation for modeling satiation and habit formation, which might improve on the current state of the art in understanding people’s tastes over time and preferences. Theoretically, this study contributes to the vein of time-nonseparable preferences.

show abstract

Section: Introductionmentioning

confidence: 99%

A Behavioral Foundation of Satiation and Habituation

Chai

2023

Mathematics

Self Cite

View full text Add to dashboard Cite

show abstract

“…We briefly review the details of PT and rank-dependent utility (RDU) as our background. RDU was developed by Schmeidler [27] through an axiomatic method on the subjective expected utility (SEU) of Savage [28,29].…”

Section: Introductionmentioning

confidence: 99%