expected utility การใช้

• Then we maximize the expected value of a concave expected utility function.
• His work include the theory of Maxmin Expected Utility with David Schmeidler.
• Choice under uncertainty is often characterized as the maximization of expected utility.
• Rabin criticizes this implication of expected utility theory on grounds of implausibility.
• Proponents of this view suggest using an expected utility calculation instead.
• Thus we can write expected utility in terms of two moments of w:
• Theories of bounded rationality relax one or more assumptions of standard expected utility theory.
• This is reflected in the theory of subjective expected utility.
• Recently, expected utility theory has been extended to arrive at more behavioral decision models.
• If the uncertainty is uniformly distributed, then expected utility maximization becomes expected value maximization.
• Consequently, a choice based on " maximizing " the expected utility is also impossible.
• All individuals are assumed to try to maximize the expected utility of their actions.
• Theories of bounded rationality relax one or more assumptions of standard expected utility theory.
• Like any mathematical model, expected utility theory is an abstraction and simplification of reality.
• The expected utility maximizing individual makes decisions rationally based on the axioms of the theory.
• David Schmeidler also developed the Choquet expected utility model.
• Then under exponential utility, expected utility is given by:
• This defies conventional rationality behind subjective expected utility theory.
• Ellsberg actually proposed two separate thought experiments, the proposed choices which contradict subjective expected utility.
• This is called the " expected utility theorem ".