Choquet Rationality
- Creators
- Ghirardato, Paolo
- Le Breton, Michel
Abstract
We provide a characterization of the consequences of the assumption that a decision maker with a given utility function is Choquet rational: She maximizes expected utility, but possibly with respect to non-additive beliefs, so that her preferences are represented by Choquet expected utility (CEU). The characterization shows that this notion of rationality allows in general to rationalize more choices than it is possible when beliefs have to be additive. More surprisingly, we find that a considerable restriction on the types of beliefs allowed does not change the set of rational actions. We then remark on the relation between the predictions of C E U model, of a similar model (the maxmin expected utility model), and those of subjective expected utility when the risk attitude of the decision maker is not known. We close with an application of the result to the definition of a solution concept (in the spirit of rationalizability) for strategic-form games.
Additional Information
Revised version. Original dated to March 1997. A previous version of this paper was circulated with the title "Choquet Rationalizability." We are indebted to Paolo Battigalli, Kim Border, Larry Epstein, John Ledyard, Massimo Marinacci, Igal Milchtaich, Klaus Nehring and audiences at Berkeley, Caltech, Paris VI and the LOFT 2 conference (Turin, December 1996) , the Conference on "Rationality in Game Theory and Utility Theory" (Caen, June 1997) and ESEM 97 (Toulouse, August 1997) for helpful comments and discussion. The second author is grateful to the Division of the Humanities and Social Sciences at Caltech for its hospitality during the period in which this paper was written. Published as Ghirardato, P., & Le Breton, M. (2000). Choquet rationality. Journal of Economic Theory, 90(2), 277-285.Attached Files
Submitted - sswp1000_-_revised.pdf
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Additional details
- Eprint ID
- 80396
- Resolver ID
- CaltechAUTHORS:20170814-163740702
- Created
-
2017-08-15Created from EPrint's datestamp field
- Updated
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2019-10-03Created from EPrint's last_modified field
- Caltech groups
- Social Science Working Papers
- Series Name
- Social Science Working Paper
- Series Volume or Issue Number
- 1000