How to Make an Action Attractive

Marilyn Pease and Mark Whitmeyer

Papers from arXiv.org

Abstract: A policymaker often wants to steer a decision-maker toward one of two actions, but lacks reliable knowledge of how the decision-maker perceives uncertainty or evaluates risk. We formalize a notion of robust paternalism: a modification a' of a desired action a is robustly more attractive than a relative to b if, for every belief over states and every increasing concave utility function, whenever the decision-maker prefers a to b, she also prefers a' to b. We characterize all such modifications directly in terms of state-dependent payoffs and discuss applications to political competition, bilateral trade, insurance, and information acquisition.

Date: 2024-08, Revised 2026-04
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Citations: View citations in EconPapers (2)

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