Probabilistic risk aversion with an arbitrary outcome set

Pavlo R. Blavatskyy

Economics Letters, 2011, vol. 112, issue 1, pages 34-37

Abstract: This paper analyzes risk aversion when outcomes/consequences may not be measurable in monetary terms and people have fuzzy preferences over lotteries, i.e. they choose in a probabilistic manner. The paper shows that comparative risk aversion is well defined in a constant error/tremble model but not in a strong utility model.

Keywords: Risk; aversion; More; risk; averse; than; Probabilistic; choice; Strong; utility; model; Fechner; model; Luce; choice; model (search for similar items in EconPapers)
Date: 2011
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Persistent link: http://EconPapers.repec.org/RePEc:eee:ecolet:v:112:y:2011:i:1:p:34-37

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