In 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, ratio ...
, a decision rule is said to dominate another if the performance of the former is sometimes better, and never worse, than that of the latter.
Formally, let
and
be two
decision rules
A decision tree is a decision support recursive partitioning structure that uses a tree-like model of decisions and their possible consequences, including chance event outcomes, resource costs, and utility. It is one way to display an algori ...
, and let
be the
risk
In simple terms, risk is the possibility of something bad happening. Risk involves uncertainty about the effects/implications of an activity with respect to something that humans value (such as health, well-being, wealth, property or the environ ...
of rule
for parameter
. The decision rule
is said to dominate the rule
if
for all
, and the inequality is strict for some
.
[.]
This defines a
partial order
In mathematics, especially order theory, a partial order on a set is an arrangement such that, for certain pairs of elements, one precedes the other. The word ''partial'' is used to indicate that not every pair of elements needs to be comparable ...
on decision rules; the
maximal element
In mathematics, especially in order theory, a maximal element of a subset S of some preordered set is an element of S that is not smaller than any other element in S. A minimal element of a subset S of some preordered set is defined dually as an ...
s with respect to this order are called ''
admissible decision rule
In statistical decision theory, an admissible decision rule is a rule for making a decision such that there is no other rule that is always "better" than it (or at least sometimes better and never worse), in the precise sense of "better" define ...
s.''
References
{{statistics-stub
Decision theory