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Fully Bayesian Aggregation

Franz Dietrich

Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) from HAL

Abstract: Can a group be an orthodox rational agent? This requires the group's aggregate preferences to follow expected utility (static rationality) and to evolve by Bayesian updating (dynamic rationality). Group rationality is possible, but the only preference aggregation rules which achieve it (and are minimally Paretian and continuous) are the linear-geometric rules, which combine individual values linearly and combine individual beliefs geometrically. Linear-geometric preference aggregation contrasts with classic linear-linear preference aggregation, which combines both values and beliefs linearly, but achieves only static rationality. Our characterisation of linear-geometric preference aggregation has two corollaries: a characterisation of linear aggregation of values (Harsanyi's Theorem) and a characterisation of geometric aggregation of beliefs.

Keywords: rational group agent; uncertainty; preference aggregation; opinion pooling; values aggregation; static versus dynamic rationality; expected-utility hypothesis; Bayesianism; group rationality versus Paretianism; spurious unanimity; ex-ante versus ex-post Pareto (search for similar items in EconPapers)
Date: 2021
New Economics Papers: this item is included in nep-hpe
Note: View the original document on HAL open archive server: https://hal.archives-ouvertes.fr/hal-03194928
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Published in Journal of Economic Theory, Elsevier, inPress

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Working Paper: Fully Bayesian Aggregation (2021) Downloads
Working Paper: Fully Bayesian Aggregation (2021) Downloads
Working Paper: Fully Bayesian Aggregation (2021) Downloads
Working Paper: Fully Bayesian Aggregation (2021) Downloads
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