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Preference
In psychology, economics and philosophy, preference is a technical term usually used in relation to choosing between alternatives. For example, someone prefers A over B if they would rather choose A than B. Preferences are central to decision theory because of this relation to behavior. Some methods such as Ordinal Priority Approach use preference relation for decision-making. As connative states, they are closely related to desires. The difference between the two is that desires are directed at one object while preferences concern a comparison between two alternatives, of which one is preferred to the other. In insolvency, the term is used to determine which outstanding obligation the insolvent party has to settle first. Psychology In psychology, preferences refer to an individual's attitude towards a set of objects, typically reflected in an explicit decision-making process. The term is also used to mean evaluative judgment in the sense of liking or disliking an object, as in ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Rational Choice Theory
Rational choice modeling refers to the use of decision theory (the theory of rational choice) as a set of guidelines to help understand economic and social behavior. The theory tries to approximate, predict, or mathematically model human behavior by analyzing the behavior of a rational actor facing the same costs and benefits.Gary Browning, Abigail Halcli, Frank Webster (2000). ''Understanding Contemporary Society: Theories of the Present'', London: Sage Publications. Rational choice models are most closely associated with economics, where mathematical analysis of behavior is standard. However, they are widely used throughout the social sciences, and are commonly applied to cognitive science, criminology, political science, and sociology. Overview The basic premise of rational choice theory is that the decisions made by individual actors will collectively produce aggregate social behaviour. The theory also assumes that individuals have preferences out of available choice ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Utility Function
In economics, utility is a measure of a certain person's satisfaction from a certain state of the world. Over time, the term has been used with at least two meanings. * In a Normative economics, normative context, utility refers to a goal or objective that we wish to maximize, i.e., an objective function. This kind of utility bears a closer resemblance to the original Utilitarianism, utilitarian concept, developed by moral philosophers such as Jeremy Bentham and John Stuart Mill. * In a Positive economics, descriptive context, the term refers to an ''apparent'' objective function; such a function is Revealed preference, revealed by a person's behavior, and specifically by their preferences over Lottery (decision theory), lotteries, which can be any quantified choice. The relationship between these two kinds of utility functions has been a source of controversy among both Economics, economists and Ethics, ethicists, with most maintaining that the two are distinct but generally re ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Utility
In economics, utility is a measure of a certain person's satisfaction from a certain state of the world. Over time, the term has been used with at least two meanings. * In a normative context, utility refers to a goal or objective that we wish to maximize, i.e., an objective function. This kind of utility bears a closer resemblance to the original utilitarian concept, developed by moral philosophers such as Jeremy Bentham and John Stuart Mill. * In a descriptive context, the term refers to an ''apparent'' objective function; such a function is revealed by a person's behavior, and specifically by their preferences over lotteries, which can be any quantified choice. The relationship between these two kinds of utility functions has been a source of controversy among both economists and ethicists, with most maintaining that the two are distinct but generally related. Utility function Consider a set of alternatives among which a person has a preference ordering. A utility fu ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Expected Utility Hypothesis
The expected utility hypothesis is a foundational assumption in mathematical economics concerning decision making under uncertainty. It postulates that rational agents maximize utility, meaning the subjective desirability of their actions. Rational choice theory, a cornerstone of microeconomics, builds this postulate to model aggregate social behaviour. 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. Graphically the curvature of the u function captures the agent's risk attitude. For example, imagine you’re offered a choice between receiving $50 for sure, or flipping a coin to win $100 i ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Gérard Debreu
Gérard Debreu (; 4 July 1921 – 31 December 2004) was a French-born economist and mathematician. Best known as a professor of economics at the University of California, Berkeley, where he began work in 1962, he won the 1983 Nobel Memorial Prize in Economic Sciences. Biography His father was the business partner of his maternal grandfather in lace manufacturing, a traditional industry in Calais. Debreu was orphaned at an early age, as his father committed suicide and his mother died of natural causes. Prior to the start of World War II, he received his baccalauréat and went to Ambert to begin preparing for the entrance examination of a grande école. Later on, he moved from Ambert to Grenoble to complete his preparation, both places being in Vichy France during World War II. In 1941, he was admitted to the École Normale Supérieure in Paris, along with Marcel Boiteux. He was influenced by Henri Cartan and the Bourbaki writers. When he was about to take the final examinati ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Choice
A choice is the range of different things from which a being can choose. The arrival at a choice may incorporate Motivation, motivators and Choice modelling, models. Freedom of choice is generally cherished, whereas a severely limited or artificially restricted choice can lead to discomfort with choosing, and possibly an unsatisfactory outcome. In contrast, a choice with excessively numerous options may lead to confusion, reduced satisfaction, regret of the alternatives not taken, and indifference in an unstructured existence; and the illusion that choosing an object or a course, necessarily leads to the control of that object or course, can cause psychological problems. Types One can distinguish four or five main types of decisions, although they can be expressed in different ways. Brian Tracy breaks them down into: # command decisions, which can only be made by you, as the "Commander in Chief", or owner of a company # delegated decisions, which may be made by anyone. Decisio ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Desires
Desires are states of mind that are expressed by terms like "wanting", " wishing", "longing" or "craving". A great variety of features is commonly associated with desires. They are seen as propositional attitudes towards conceivable states of affairs. They aim to change the world by representing how the world should be, unlike beliefs, which aim to represent how the world actually is. Desires are closely related to agency: they motivate the agent to realize them. For this to be possible, a desire has to be combined with a belief about which action would realize it. Desires present their objects in a favorable light, as something that appears to be good. Their fulfillment is normally experienced as pleasurable in contrast to the negative experience of failing to do so. Conscious desires are usually accompanied by some form of emotional response. While many researchers roughly agree on these general features, there is significant disagreement about how to define desires, i.e. wh ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Behavioural Economics
Behavioral economics is the study of the psychological (e.g. cognitive, behavioral, affective, social) factors involved in the decisions of individuals or institutions, and how these decisions deviate from those implied by traditional economic theory. Behavioral economics is primarily concerned with the bounds of rationality of economic agents. Behavioral models typically integrate insights from psychology, neuroscience and microeconomic theory. Behavioral economics began as a distinct field of study in the 1970s and 1980s, but can be traced back to 18th-century economists, such as Adam Smith, who deliberated how the economic behavior of individuals could be influenced by their desires. The status of behavioral economics as a subfield of economics is a fairly recent development; the breakthroughs that laid the foundation for it were published through the last three decades of the 20th century. Behavioral economics is still growing as a field, being used increasingly in ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Decision Theory
Decision theory or the theory of rational choice is a branch of probability theory, probability, economics, and analytic philosophy that uses expected utility and probabilities, probability to model how individuals would behave Rationality, rationally under uncertainty. It differs from the Cognitive science, cognitive and Behavioural sciences, behavioral sciences in that it is mainly Prescriptive economics, prescriptive and concerned with identifying optimal decision, optimal decisions for a rational agent, rather than Descriptive economics, describing how people actually make decisions. Despite this, the field is important to the study of real human behavior by Social science, social scientists, as it lays the foundations to Mathematical model, mathematically model and analyze individuals in fields such as sociology, economics, criminology, cognitive science, moral philosophy and political science. History The roots of decision theory lie in probability theory, developed by Blai ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Transitive Relation
In mathematics, a binary relation on a set (mathematics), set is transitive if, for all elements , , in , whenever relates to and to , then also relates to . Every partial order and every equivalence relation is transitive. For example, less than and equality (mathematics), equality among real numbers are both transitive: If and then ; and if and then . Definition A homogeneous relation on the set is a ''transitive relation'' if, :for all , if and , then . Or in terms of first-order logic: :\forall a,b,c \in X: (aRb \wedge bRc) \Rightarrow aRc, where is the infix notation for . Examples As a non-mathematical example, the relation "is an ancestor of" is transitive. For example, if Amy is an ancestor of Becky, and Becky is an ancestor of Carrie, then Amy is also an ancestor of Carrie. On the other hand, "is the birth mother of" is not a transitive relation, because if Alice is the birth mother of Brenda, and Brenda is the birth mother of Claire, then it does ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Neoclassical Economists
Neoclassical economics is an approach to economics in which the production, consumption, and valuation (pricing) of goods and services are observed as driven by the supply and demand model. According to this line of thought, the value of a good or service is determined through a hypothetical maximization of utility by income-constrained individuals and of profits by firms facing production costs and employing available information and factors of production. This approach has often been justified by appealing to rational choice theory. Neoclassical economics is the dominant approach to microeconomics and, together with Keynesian economics, formed the neoclassical synthesis which dominated mainstream economics as "neo-Keynesian economics" from the 1950s onward. Classification The term was originally introduced by Thorstein Veblen in his 1900 article "Preconceptions of Economic Science", in which he related marginalists in the tradition of Alfred Marshall ''et al.'' to those ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Andranik Tangian
Andranik Semovich Tangian (Melik-Tangyan) (Russian: Андраник Семович Тангян (Мелик-Тангян)); born March 29, 1952) is a Soviet Armenian-German mathematician, political economist and music theorist. He is professor of the Institute for Economics (ECON) of the Karlsruhe Institute of Technology. Biography As a self-taught composer, he debuted with orchestral music to the play ''The Last Trimester'' at the Moscow in 1977. Tangian spent the academic year 1990/91 at the University of Hagen and published his first monograph on the mathematical theory of democracy in 1991. During the next two academic years, Tangian has been visiting professor/researcher at the computer music studio ACROE–LIFIA of the Grenoble Institute of Technology, where he wrote a monograph on artificial perception and music. From 1993 to 2002 Tangian ran a project on constructing objective functions for econometric decision models at the University of Hagen. Works Mathematica ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
