Calibration Results for Incomplete Preferences

Zvi Safra and Uzi Segal

Revue économique, 2020, vol. 71, issue 2, 323-330

Abstract: In this work we demonstrate that incomplete expected utility preferences are susceptible to criticism similar to that addressed at their complete analogues: even a modest degree of risk aversion in the small is sufficient to imply extreme and unreasonable degree of risk aversion in the large. Our results thus shed doubt on the usefulness of incomplete expected utility preferences for practical and theoretical purposes. JEL Codes: D81.

Keywords: calibration; incomplete preferences; risk aversion (search for similar items in EconPapers)
JEL-codes: D81 (search for similar items in EconPapers)
Date: 2020
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Working Paper: Calibration Results for Incomplete Preferences (2008)
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