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Aggregating sets of von Neumann-Morgenstern utilities

Eric Danan (), Thibault Gajdos () and Jean-Marc Tallon ()

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Abstract: We analyze the aggregation problem without the assumption that individuals and society have fully determined and observable preferences. More precisely, we endow individuals ans society with sets of possible von Neumann-Morgenstern utility functions over lotteries. We generalize the classical neutrality assumption to this setting and characterize the class of neutral social welfare function. This class turns out to be considerably broader for indeterminate than for determinate utilities, where it basically reduces to utilitarianism. In particular, aggregation rules may differ by the relationship between individual and social indeterminacy. We characterize several subclasses of neutral aggregation rules and show that utilitarian rules are those that yield the least indeterminate social utilities, although they still fail to systematically yield a determinate social utility.

Keywords: Aggregation; vNM utility; indeterminacy; neutrality; utilitarianism (search for similar items in EconPapers)
Date: 2013-03
New Economics Papers: this item is included in nep-mic
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Published in Journal of Economic Theory, Elsevier, 2013, 148 (2), pp.663-688. ⟨10.1016/j.jet.2012.12.018⟩

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Journal Article: Aggregating sets of von Neumann–Morgenstern utilities (2013) Downloads
Working Paper: Aggregating sets of von Neumann-Morgenstern utilities (2010) Downloads
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DOI: 10.1016/j.jet.2012.12.018

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