IS IT ALWAYS RATIONAL TO SATISFY SAVAGE'S AXIOMS?

Itzhak Gilboa, Andrew Postlewaite and David Schmeidler

Economics and Philosophy, 2009, vol. 25, issue 3, 285-296

Abstract: This note argues that, under some circumstances, it is more rational not to behave in accordance with a Bayesian prior than to do so. The starting point is that in the absence of information, choosing a prior is arbitrary. If the prior is to have meaningful implications, it is more rational to admit that one does not have sufficient information to generate a prior than to pretend that one does. This suggests a view of rationality that requires a compromise between internal coherence and justification, similarly to compromises that appear in moral dilemmas. Finally, it is argued that Savage's axioms are more compelling when applied to a naturally given state space than to an analytically constructed one; in the latter case, it may be more rational to violate the axioms than to be Bayesian.

Date: 2009
References: Add references at CitEc
Citations: View citations in EconPapers (83)

Downloads: (external link)
https://www.cambridge.org/core/product/identifier/ ... type/journal_article link to article abstract page (text/html)

Related works:
Working Paper: Is It Always Rational to Satisfy Savage’s Axioms? (2009)
Working Paper: Is It Always Rational to Satisfy Savage's Axioms? (2009)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:cup:ecnphi:v:25:y:2009:i:03:p:285-296_99

Access Statistics for this article

More articles in Economics and Philosophy from Cambridge University Press Cambridge University Press, UPH, Shaftesbury Road, Cambridge CB2 8BS UK.
Bibliographic data for series maintained by Kirk Stebbing (csjnls@cambridge.org).