Two-moment Decision Models and Expected Utility Maximization

Jack Meyer ()

American Economic Review, 1987, vol. 77, issue 3, 421-30

Abstract: Two-moment decision models are consistent with expected utility maximization only if the choice set or the agent's preferences are restricted. All currently available restrictions, such as quadratic utility or normality, are either theoretically deficient and/or empirically rejected. This paper identifies another restriction which is sufficient to ensure consistency between the two approaches and confirms that it holds in many economic models. Implications of this restriction for moment model analysis are then derived. Copyright 1987 by American Economic Association.

Date: 1987
References: Add references at CitEc
Citations: View citations in EconPapers (310)

Downloads: (external link)
http://links.jstor.org/sici?sici=0002-8282%2819870 ... O%3B2-0&origin=repec full text (application/pdf)
Access to full text is restricted to JSTOR subscribers. See http://www.jstor.org for details.

Related works:
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:aea:aecrev:v:77:y:1987:i:3:p:421-30

Ordering information: This journal article can be ordered from
https://www.aeaweb.org/journals/subscriptions

Access Statistics for this article

American Economic Review is currently edited by Esther Duflo

More articles in American Economic Review from American Economic Association Contact information at EDIRC.
Bibliographic data for series maintained by Michael P. Albert ().