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Relative uncertainty aversion and additively representable set rankings
Author(s) -
Bossert Walter,
Slinko Arkadii
Publication year - 2006
Publication title -
international journal of economic theory
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.351
H-Index - 11
eISSN - 1742-7363
pISSN - 1742-7355
DOI - 10.1111/j.1742-7363.2006.00026.x
Subject(s) - axiom , ranking (information retrieval) , class (philosophy) , mathematical economics , context (archaeology) , set (abstract data type) , ambiguity aversion , risk aversion (psychology) , mathematics , economics , econometrics , expected utility hypothesis , computer science , artificial intelligence , paleontology , ambiguity , geometry , biology , programming language
This paper proposes a definition of relative uncertainty aversion for decision models under complete uncertainty. It is shown that, for a large class of decision rules characterized by a set of plausible axioms, the new criterion yields a complete ranking of those rules with respect to the relative degree of uncertainty aversion they represent. In addition, we address a combinatorial question that arises in this context, and we examine conditions for the additive representability of our rules.