Transitive Regret over Statistically Independent Lotteries

Uzi Segal

No 796, Boston College Working Papers in Economics from Boston College Department of Economics

Abstract: Preferences may arise from regret, i.e., from comparisons with alternatives forgone by the decision maker. We show that when the choice set consists of pairwise statistically independent lotteries, transitive regret-based behavior is consistent with betweenness preferences and with a family of preferences that is characterized by a consistency property. Examples of consistent preferences include CARA, CRRA, and anticipated utility.

Keywords: Regret; transitivity; non-expected utility (search for similar items in EconPapers)
Date: 2012-04-02
New Economics Papers: this item is included in nep-evo, nep-mic and nep-upt
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Journal Article: Transitive regret over statistically independent lotteries (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:boc:bocoec:796

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