An argument for the principle of maximizing expected utility Academic Article uri icon

abstract

  • Abstract: The main result of this paper is a formal argument for the principle of maximizing expected utility that does not rely on the law of large numbers. Unlike the wellknown arguments by Savage and von Neumann & Morgenstern, this argument does not presuppose the surething principle or the independence axiom. The principal idea is to use the concept of transformative decision rules for decomposing the principle of maximizing expected utility into a sequence of normatively reasonable subrules. It is shown that this procedure provides a resolution of Allais's paradox that cannot be obtained by Savagestyle or von Neumann & Morgensternstyle arguments.

published proceedings

  • Theoria

author list (cited authors)

  • Peterson, M.

citation count

  • 4

complete list of authors

  • Peterson, Martin

publication date

  • August 2002

publisher