A Violation Of The Monotonicity Axiom
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A Violation Of The Monotonicity Axiom
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Author : Edmund Fantino
language : en
Publisher:
Release Date : 2001
A Violation Of The Monotonicity Axiom written by Edmund Fantino and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2001 with categories.
The conjunction fallacy is an anomaly in human reasoning for which the conjunction of two events is rated more likely to occur than one of the events alone. In the context of decision under uncertainty, this violates the monotonicity axiom of probability, and consequentially also Bayes' Rule and the monotonicity axiom of preferences. Our experiments show how dynamic feedback and monetary incentives affect the fallacy rate, and how the complexity (and possibly the presentation) of the decision problem and an averaging heuristic might determine outcomes and reasoning. Keyword(s): Monotonicity axiom; Conjunction fallacy; Learning; Bounded rationality.
An Experimental Test Of The Anscombe Aumann Monotonicity Axiom
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Author : Florian Schneider
language : en
Publisher:
Release Date : 2017
An Experimental Test Of The Anscombe Aumann Monotonicity Axiom written by Florian Schneider and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2017 with categories.
Most models of ambiguity aversion satisfy Anscombe-Aumann's Monotonicity axiom. Monotonicity imposes separability of preferences across events that occur with unknown probability. We construct a test of Monotonicity by modifying the Allais paradox to a setting with both subjective and objective uncertainty. Two experimental studies are conducted: while study 1 uses U.S. online workers and a natural source of ambiguity, study 2 employs European students and an Ellsberg urn. In both studies, modal behavior violates Monotonicity in a specific, intuitive way. Overall, our data suggest that violations of Monotonicity are as prevalent as violations of von Neumann-Morgenstern's Independence axiom.
Axiom Of Monotonicity
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Author : Tridib Sharma
language : en
Publisher:
Release Date : 2011
Axiom Of Monotonicity written by Tridib Sharma and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2011 with categories.
The Axiom of Monotonicity (AM) is a necessary condition for a number of expected utility representations, including those obtained by de Finetti (1930), von Neumann and Morgenstern (1944), Savage (1954), and Anscombe and Auman (1963). The paper reports on experiments that directly test AM by eliminating strategic uncertainty, context, and peer effects. In one treatment, the state space is simple to formulate. Here we do not observe violations of AM. When the state space is a bit more obscure, we find significant violations of AM.
Stochastic Dominance
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Author : Haim Levy
language : en
Publisher: Springer
Release Date : 2015-10-31
Stochastic Dominance written by Haim Levy and has been published by Springer this book supported file pdf, txt, epub, kindle and other format this book has been release on 2015-10-31 with Business & Economics categories.
This fully updated third edition is devoted to the analysis of various Stochastic Dominance (SD) decision rules. It discusses the pros and cons of each of the alternate SD rules, the application of these rules to various research areas like statistics, agriculture, medicine, measuring income inequality and the poverty level in various countries, and of course, to investment decision-making under uncertainty. The book features changes and additions to the various chapters, and also includes two completely new chapters. One deals with asymptotic SD and the relation between FSD and the maximum geometric mean (MGM) rule (or the maximum growth portfolio). The other new chapter discusses bivariate SD rules where the individual’s utility is determined not only by his own wealth, but also by his standing relative to his peer group. Stochastic Dominance: Investment Decision Making under Uncertainty, 3rd Ed. covers the following basic issues: the SD approach, asymptotic SD rules, the mean-variance (MV) approach, as well as the non-expected utility approach. The non-expected utility approach focuses on Regret Theory (RT) and mainly on prospect theory (PT) and its modified version, cumulative prospect theory (CPT) which assumes S-shape preferences. In addition to these issues the book suggests a new stochastic dominance rule called the Markowitz stochastic dominance (MSD) rule corresponding to all reverse-S-shape preferences. It also discusses the concept of the multivariate expected utility and analyzed in more detail the bivariate expected utility case. From the reviews of the second edition: "This book is an economics book about stochastic dominance. ... is certainly a valuable reference for graduate students interested in decision making under uncertainty. It investigates and compares different approaches and presents many examples. Moreover, empirical studies and experimental results play an important role in this book, which makes it interesting to read." (Nicole Bäuerle, Mathematical Reviews, Issue 2007 d)
Choice Decision And Measurement
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Author : A.A.J. Marley
language : en
Publisher: Routledge
Release Date : 2019-05-23
Choice Decision And Measurement written by A.A.J. Marley and has been published by Routledge this book supported file pdf, txt, epub, kindle and other format this book has been release on 2019-05-23 with Psychology categories.
This volume is the result of a conference held at the University of California, Irvine, on the topics that provide its title -- choice, decision, and measurement. The conference was planned, and the volume prepared, in honor of Professor R. Duncan Luce on his 70th birthday. Following a short autobiographical statement by Luce, the volume is organized into four topics, to each of which Luce has made significant contributions. The book provides an overview of current issues in each area and presents some of the best recent theoretical and empirical work. Personal reflections on Luce and his work begin each section. These reflections were written by outstanding senior researchers: Peter Fishburn (Preference and Decision Making), Patrick Suppes (Measurement Theory and Axiomatic Systems), William J. McGill (Psychophysics and Reaction Time), and W.K. Estes (Choice, Identification and Categorization). The first section presents recent theoretical and empirical work on descriptive models of decision making, and theoretical results on general probabilistic models of choice and ranking. Luce's recent theoretical and empirical work on rank- and sign-dependent utility theory is important in many of these contributions. The second section presents results from psychophysics, probabilistic measurement, aggregation of expert opinion, and test theory. The third section presents various process oriented models, with supportive data, for tasks such as redundant signal detection, forced choice, and absolute identification. The final section contains theory and data on categorization and attention, and general theoretical results for developing and testing models in these domains.
The Quality Of Life
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Author : Martha Nussbaum
language : en
Publisher: Oxford University Press
Release Date : 1993-03-11
The Quality Of Life written by Martha Nussbaum and has been published by Oxford University Press this book supported file pdf, txt, epub, kindle and other format this book has been release on 1993-03-11 with Fiction categories.
Commentator: Ruth Anna Putnam
Additive And Polynomial Representations
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Author : David H. Krantz
language : en
Publisher: Courier Corporation
Release Date : 2006-12-01
Additive And Polynomial Representations written by David H. Krantz and has been published by Courier Corporation this book supported file pdf, txt, epub, kindle and other format this book has been release on 2006-12-01 with Mathematics categories.
All of the sciences — physical, biological, and social — have a need for quantitative measurement. This influential series, Foundations of Measurement, established the formal foundations for measurement, justifying the assignment of numbers to objects in terms of their structural correspondence. Volume I introduces the distinct mathematical results that serve to formulate numerical representations of qualitative structures. Volume II extends the subject in the direction of geometrical, threshold, and probabilistic representations, and Volume III examines representation as expressed in axiomatization and invariance.
Axiomatic Bargaining Game Theory
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Author : H.J. Peters
language : en
Publisher: Springer Science & Business Media
Release Date : 2013-04-17
Axiomatic Bargaining Game Theory written by H.J. Peters and has been published by Springer Science & Business Media this book supported file pdf, txt, epub, kindle and other format this book has been release on 2013-04-17 with Business & Economics categories.
Many social or economic conflict situations can be modeled by specifying the alternatives on which the involved parties may agree, and a special alternative which summarizes what happens in the event that no agreement is reached. Such a model is called a bargaining game, and a prescription assigning an alternative to each bargaining game is called a bargaining solution. In the cooperative game-theoretical approach, bargaining solutions are mathematically characterized by desirable properties, usually called axioms. In the noncooperative approach, solutions are derived as equilibria of strategic models describing an underlying bargaining procedure. Axiomatic Bargaining Game Theory provides the reader with an up-to-date survey of cooperative, axiomatic models of bargaining, starting with Nash's seminal paper, The Bargaining Problem. It presents an overview of the main results in this area during the past four decades. Axiomatic Bargaining Game Theory provides a chapter on noncooperative models of bargaining, in particular on those models leading to bargaining solutions that also result from the axiomatic approach. The main existing axiomatizations of solutions for coalitional bargaining games are included, as well as an auxiliary chapter on the relevant demands from utility theory.
The Perception Of Poverty
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Author : A.J.M. Hagenaars
language : en
Publisher: Elsevier
Release Date : 2014-06-28
The Perception Of Poverty written by A.J.M. Hagenaars and has been published by Elsevier this book supported file pdf, txt, epub, kindle and other format this book has been release on 2014-06-28 with Social Science categories.
An attempt to define, measure and explain poverty is presented in this volume by means of a newly developed theoretical model. A combination of theory and empirical application is achieved by using the theoretical model on a sizeable data set derived from an extensive survey conducted in eight European countries. The nature of poverty is thereby empirically defined (and not a priori) as being the income level at which households feel that their income is just between sufficient and insufficient.An aggregate poverty index, associated with this poverty line definition, is calculated for each country and for subgroups within each country.Conclusions for social policy are drawn, describing which groups are at especially high risk of entering poverty, and who therefore need more specific policies. It is also discussed to what extent economic growth will eliminate poverty and which alternative measures are available.
Microscopic Simulation Of Financial Markets
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Author : Haim Levy
language : en
Publisher: Elsevier
Release Date : 2000-08-02
Microscopic Simulation Of Financial Markets written by Haim Levy and has been published by Elsevier this book supported file pdf, txt, epub, kindle and other format this book has been release on 2000-08-02 with Business & Economics categories.
Microscopic Simulation (MS) uses a computer to represent and keep track of individual ("microscopic") elements in order to investigate complex systems which are analytically intractable. A methodology that was developed to solve physics problems, MS has been used to study the relation between microscopic behavior and macroscopic phenomena in systems ranging from those of atomic particles, to cars, animals, and even humans. In finance, MS can help explain, among other things, the effects of various elements of investor behavior on market dynamics and asset pricing. It is these issues in particular, and the value of an MS approach to finance in general, that are the subjects of this book. The authors not only put their work in perspective by surveying traditional economic analyses of investor behavior, but they also briefly examine the use of MS in fields other than finance. Most models in economics and finance assume that investors are rational. However, experimental studies reveal systematic deviations from rational behavior. How can we determine the effect of investors' deviations from rational behavior on asset prices and market dynamics? By using Microscopic Simulation, a methodology originally developed by physicists for the investigation of complex systems, the authors are able to relax classical assumptions about investor behavior and to model it as empirically and experimentally observed. This rounded and judicious introduction to the application of MS in finance and economics reveals that many of the empirically-observed "puzzles" in finance can be explained by investors' quasi-rationality. Researchers use the book because it models heterogeneous investors, a group that has proven difficult to model. Being able to predict how people will invest and setting asset prices accordingly is inherently appealing, and the combination of computing power and statistical mechanics in this book makes such modeling possible. Because many finance researchers have backgrounds in physics, the material here is accessible. Emphasizes investor behavior in determining asset prices and market dynamics Introduces Microscopic Simulation within a simplified framework Offers ways to model deviations from rational decision-making