Attitude towards Information and Non-Expected Utility Preferences: a Characterization by Choice Functions

Marc-Arthur Diaye (marc-arthur.diaye@eco.univ-evry.fr) and Jean-Max Koskievic
Additional contact information
Marc-Arthur Diaye: EPEE, Université d’Evry and CREST (LSM)

No 01-16, Documents de recherche from Centre d'Études des Politiques Économiques (EPEE), Université d'Evry Val d'Essonne

Abstract: In the Allais paradox, if an agent’s preferences violate independence axiom, the (non- Expected Utility) decision maker appears to be prone to dynamic inconsistency, that is in some sequential decision problem he may be expected to embark upon (action) plans which he is not going to follow through. Moreover, Wakker (1988) proves that non-EU decision maker can be made worse o¤, in dynamic choice setting, by getting a prior knowledge of what nature’s moves will be. Thus, dynamic inconsistency and Information aversion are closely linked. Following Wakker’s argument, a number of papers have set out the relationship between dynamic consistency and information attitude, but authors restrict the class of non-EU preferences by imposing di¤erent consistent properties, non- EU preferences must satisfy. Our approach in this paper is di¤erent, instead of starting from agent’s preferences to infer agent’s attitude towards information, conversely we start from the attitude towards information to infer the agent’s preferences “logically” possible. We display in the simplest dynamic version of the Allais’ paradox, the di¤erent possible attitudes towards information and characterize them in the Choice Functions Theory’s framework. We show for instance that an agent who has non-EU preferences can be Information Averse as pointed out by Wakker (1988) but also Information Lover. Therefore, the simple observation of non-EU preferences cannot give us any piece of information about the agent’s attitude towards information.

Keywords: Information; Decision Theory (search for similar items in EconPapers)
JEL-codes: C4 D8 (search for similar items in EconPapers)
Pages: 53 pages
Date: 2001
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://www.univ-evry.fr/fileadmin/mediatheque/uev ... es/Epee/wp/01-16.pdf (application/pdf)

Related works:
Working Paper: Attitude Towards Information and Non-Expected Utility Preferences: A Characterization by Choice Functions (2001)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eve:wpaper:01-16

Access Statistics for this paper

More papers in Documents de recherche from Centre d'Études des Politiques Économiques (EPEE), Université d'Evry Val d'Essonne Contact information at EDIRC.
Bibliographic data for series maintained by Samuel Nosel (samuel.nosel@univ-evry.fr).