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Subjective Expected Utility
In decision theory, subjective expected utility is the attractiveness of an economic opportunity as perceived by a decision-maker in the presence of risk. Characterizing the behavior of decision-makers as using subjective expected utility was promoted and axiomatized by L. J. Savage in 1954 following previous work by Ramsey and von Neumann. The theory of subjective expected utility combines two subjective concepts: first, a personal utility function, and second a personal probability distribution (usually based on Bayesian probability theory). Savage proved that, if the decision-maker adheres to axioms of rationality, believing an uncertain event has possible outcomes \ each with a utility of u(x_i), then the person's choices can be explained as arising from this utility function combined with the subjective belief that there is a probability of each outcome, P(x_i). The subjective expected utility is the resulting expected value of the utility, :\Epsilon (X)= \sum_i \; u(x_i) ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Decision Theory
Decision theory (or the theory of choice; not to be confused with choice theory) is a branch of applied probability theory concerned with the theory of making decisions based on assigning probabilities to various factors and assigning numerical consequences to the outcome. There are three branches of decision theory: # Normative decision theory: Concerned with the identification of optimal decisions, where optimality is often determined by considering an ideal decision-maker who is able to calculate with perfect accuracy and is in some sense fully rational. # Prescriptive decision theory: Concerned with describing observed behaviors through the use of conceptual models, under the assumption that those making the decisions are behaving under some consistent rules. # Descriptive decision theory: Analyzes how individuals actually make the decisions that they do. Decision theory is closely related to the field of game theory and is an interdisciplinary topic, studied by economi ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Joseph Jastrow
Joseph Jastrow (January 30, 1863 – January 8, 1944) was a Polish-born American psychologist, noted for inventions in experimental psychology, design of experiments, and psychophysics. He also worked on the phenomena of optical illusions, and a number of well-known optical illusions (notably the Jastrow illusion) were either first reported in or popularized by his work. Jastrow believed that everyone had their own, often incorrect, preconceptions about psychology. One of his goals was to use the scientific method to identify truth from error, and educate the layperson, which he did through speaking tours, popular print media, and radio. Biography Jastrow was born in Warsaw, Poland. A son of Talmud scholar Marcus Jastrow, Joseph Jastrow was the younger brother of the orientalist, Morris Jastrow, Jr. Joseph Jastrow came to Philadelphia in 1866 and received his bachelor's and master's degrees from the University of Pennsylvania. During his doctoral studies at Johns Hopki ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Martin Shubik
Martin Shubik (1926-2018) was an American mathematical economist who specialized in game theory, defense analysis, and the theory of money and financial institutions. The latter was his main research interest and he coined the term "mathematical institutional economics" in 1959 to describe it and referred to it as his "white whale" (only considering it caught after publishing his final five books on the topic). He spent the majority of his career at Yale University, where he was heavily involved with the Cowles Foundation for Research in Economics, and launched the virtuaMuseum of Money and Financial Institutions Outside of economics, he began studying inclusion body myositis (IBM) after a 2003 diagnosis. He provided seed money to the Yale School of Public Health for thIBM Disease Registryin 2011, a survey was conducted in 2012-2013, and he is a co-author on a 2015 paper about the initial results (along with his son-in-law Seth Richards-Shubik). Personal life Martin Shubik wa ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Expected Utility
The expected utility hypothesis is a popular concept in economics that serves as a reference guide for decisions when the payoff is uncertain. The theory recommends which option rational individuals should choose in a complex situation, based on their risk appetite and preferences. The expected utility hypothesis states an agent chooses between risky prospects by comparing expected utility values (i.e. the weighted sum of adding the respective utility values of payoffs multiplied by their probabilities). The summarised formula for expected utility is U(p)=\sum u(x_k)p_k where p_k is the probability that outcome indexed by k with payoff x_k is realized, and function ''u'' expresses the utility of each respective payoff. On a graph, the curvature of u will explain the agent's risk attitude. For example, if an agent derives 0 utils from 0 apples, 2 utils from one apple, and 3 utils from two apples, their expected utility for a 50–50 gamble between zero apples and two is 0.5''u''(0 ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Oskar Morgenstern
Oskar Morgenstern (January 24, 1902 – July 26, 1977) was an Austrian-American economist. In collaboration with mathematician John von Neumann, he founded the mathematical field of game theory as applied to the social sciences and strategic decision-making (see von Neumann–Morgenstern utility theorem). Companies he served as founder/co-founder of included Market Research Corporation of America, Mathematica and Mathematica Policy Research. Biography Morgenstern was born in Görlitz in the Prussian Province of Silesia. His mother was said to be a daughter of Emperor Frederick III of Germany. Morgenstern grew up in Vienna, Austria, where he also went to university. In 1925, he graduated from the University of Vienna and got his PhD in political science. From 1925 until 1928, he went on a three-year fellowship financed by the Rockefeller Foundation. After his return in 1928, he became a professor in economics at the University of Vienna until his visit to Princeton Univer ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Stanford University Press
Stanford University Press (SUP) is the publishing house of Stanford University. It is one of the oldest academic presses in the United States and the first university press to be established on the West Coast. It was among the presses officially admitted to the Association of American University Presses (now the Association of University Presses) at the organization's founding, in 1937, and is one of twenty-two current member presses from that original group. The press publishes 130 books per year across the humanities, social sciences, and business, and has more than 3,500 titles in print. History David Starr Jordan, the first president of Stanford University, posited four propositions to Leland and Jane Stanford when accepting the post, the last of which stipulated, “That provision be made for the publication of the results of any important research on the part of professors, or advanced students. Such papers may be issued from time to time as ‘Memoirs of the Leland Sta ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Sidney Siegel
Sidney Siegel (4 January 1916 in New York City – 29 November 1961) was an American psychologist who became especially well known for his work in popularising non-parametric statistics for use in the behavioural sciences. He was a co-developer of the statistical test known as the Siegel–Tukey test. Siegel completed a Ph.D. in Psychology in 1953 at Stanford University. Except for a year spent at the Center for Advanced Study in the Behavioral Sciences at Stanford, he thereafter taught at Pennsylvania State University, until his death in November 1961 of a coronary thrombosis. His parents, Jacob and Rebecca Siegel, were Jewish immigrants from Romania.Sidney Siegel (ed. Samuel Messick, Arthur H. Brayfield), ''Decision and Choice'', p.2. McGraw-Hill, 1964 See also * Siegel–Tukey test. Notes References * ''Nonparametric Statistics for the Behavioral Sciences'', 1956 * ''Bargaining and Group Decision Making'' (co-authored with Lawrence E. Fouraker), winning the 195 ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Patrick Suppes
Patrick Colonel Suppes (; March 17, 1922 – November 17, 2014) was an American philosopher who made significant contributions to philosophy of science, the theory of measurement, the foundations of quantum mechanics, decision theory, psychology and educational technology. He was the Lucie Stern Professor of Philosophy Emeritus at Stanford University and until January 2010 was the Director of the Education Program for Gifted Youth also at Stanford. Early life and career Suppes was born on March 17, 1922, in Tulsa, Oklahoma. He grew up as an only child, later with a half brother George who was born in 1943 after Patrick had entered the army. His grandfather, C. E. Suppes, had moved to Oklahoma from Ohio. Suppes' father and grandfather were independent oil men. His mother died when he was a young boy. He was raised by his stepmother, who married his father before he was six years old. His parents did not have much formal education.Cf. Suppes autobiography Suppes began college a ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Donald Davidson (philosopher)
Donald Herbert Davidson (March 6, 1917 – August 30, 2003) was an American philosopher. He served as Slusser Professor of Philosophy at the University of California, Berkeley, from 1981 to 2003 after having also held teaching appointments at Stanford University, Rockefeller University, Princeton University, and the University of Chicago. Davidson was known for his charismatic personality and the depth and difficulty of his thought. His work exerted considerable influence in many areas of philosophy from the 1960s onward, particularly in philosophy of mind, philosophy of language, and action theory. While Davidson was an analytic philosopher, and most of his influence lies in that tradition, his work has attracted attention in continental philosophy as well, particularly in literary theory and related areas. Personal life Davidson was married three times. His first wife was the artist Virginia Davidson, with whom he had his only child, a daughter, Elizabeth (Davidson) Bo ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
AFM Smith
Sir Adrian Frederick Melhuish Smith, PRS (born 9 September 1946) is a British statistician who is chief executive of the Alan Turing Institute and president of the Royal Society. Early life and education Smith was born on 9 September 1946 in Dawlish. He was educated at Selwyn College, Cambridge, and University College London, where his PhD supervisor was Dennis Lindley. Career From 1977 until 1990, he was professor of statistics and head of department of mathematics at the University of Nottingham. He was subsequently at Imperial College, London, where he was head of the mathematics department. Smith is a former deputy vice-chancellor of the University of London and became vice-chancellor of the university on 1 September 2012. He stood down from the role in August 2018 to become the director of the Alan Turing Institute. Smith is a member of the governing body of the London Business School. He served on the Advisory Council for the Office for National Statistics from 1996 to ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Bruno De Finetti
Bruno de Finetti (13 June 1906 – 20 July 1985) was an Italian probabilist statistician and actuary, noted for the "operational subjective" conception of probability. The classic exposition of his distinctive theory is the 1937 "La prévision: ses lois logiques, ses sources subjectives," which discussed probability founded on the coherence of betting odds and the consequences of exchangeability. Life De Finetti was born in Innsbruck, Austria, and studied mathematics at Politecnico di Milano. He graduated in 1927 writing his thesis under the supervision of Giulio Vivanti. After graduation, he worked as an actuary and a statistician at ''Istituto Nazionale di Statistica'' ( National Institute of Statistics) in Rome and, from 1931, the Trieste insurance company Assicurazioni Generali. In 1936 he won a competition for Chair of Financial Mathematics and Statistics, but was not nominated due to a fascist law barring access to unmarried candidates; he was appointed as ordinary profess ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Ellsberg Paradox
In decision theory, the Ellsberg paradox (or Ellsberg's paradox) is a paradox in which people's decisions are inconsistent with subjective expected utility theory. Daniel Ellsberg popularized the paradox in his 1961 paper, “Risk, Ambiguity, and the Savage Axioms”. John Maynard Keynes published a version of the paradox in 1921. It is generally taken to be evidence of ambiguity aversion, in which a person tends to prefer choices with quantifiable risks over those with unknown, incalculable risks. Ellsberg's findings indicate that choices with an underlying level of risk are favored in instances where the likelihood of risk is clear, rather than instances in which the likelihood of risk is unknown. A decision-maker will overwhelmingly favor a choice with a transparent likelihood of risk, even in instances where the unknown alternative will likely produce greater utility. When offered choices with varying risk, people prefer choices with calculable risk, even when they have les ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
