Hybrid decision model and the ranking of experiments

Edi Karni and Zvi Safra

Journal of Mathematical Economics, 2022, vol. 101, issue C

Abstract: Departing from the reduction of compound lotteries axiom on multi-stage lotteries, this paper proposes a new hybrid model to analyze decision trees. Applied to multi-stage decision trees induced by experiments, Blackwell’s (1953) definition of the relation “more informative” on the set of information structures is equivalent to experiments being more valuable to a class of non-expected utility preferences. This result extends Blackwell’s theorem and provides new insights regarding the evaluation of information produced by experiments.

Keywords: Blackwell’s theorem; Comparison of experiments; Reduction of compound lotteries; Value of information; Hybrid decision analysis (search for similar items in EconPapers)
Date: 2022
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:mateco:v:101:y:2022:i:c:s0304406822000489

DOI: 10.1016/j.jmateco.2022.102700

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