When is there state independence?
Brian Hill ()
Journal of Economic Theory, 2009, vol. 144, issue 3, 1119-1134
Abstract:
Whether a preference relation can be represented using state-independent utilities as opposed to state-dependent utilities may depend on which acts count as constant acts. This observation underlies an extension of Savage's expected utility theory to the state-dependent case that was proposed in this journal by Edi Karni. His result contains a condition requiring the existence of a set of acts which can play the role of constant acts and support a representation involving a state-independent utility function. This paper contains necessary and sufficient conditions on the preference relation for such a set of acts to exist. Results are obtained both for the Savage and the Anscombe and Aumann frameworks. Among the corollaries are representation theorems for state-dependent utilities. Relationships to Karni's work and extensions of the results are discussed.
Keywords: Subjective; expected; utility; State-dependent; utility; Monotonicity; axiom (search for similar items in EconPapers)
Date: 2009
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Citations: View citations in EconPapers (3)
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Related works:
Working Paper: When is there state independence? (2009)
Working Paper: When is there state independence? (2007) 
Working Paper: When is there state independence? (2007)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jetheo:v:144:y:2009:i:3:p:1119-1134
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