A process approach to the utility for gambling

Marc Le Menestrel ()

Economics Working Papers from Department of Economics and Business, Universitat Pompeu Fabra

Abstract: This paper argues that any specific utility or disutility for gambling must be excluded from expected utility because such a theory is consequential while a pleasure or displeasure for gambling is a matter of process, not of consequences. A (dis)utility for gambling is modeled as a process utility which monotonically combines with expected utility restricted to consequences. This allows for a process (dis)utility for gambling to be revealed. As an illustration, the model shows how empirical observations in the Allais paradox can reveal a process disutility of gambling. A more general model of rational behavior combining processes and consequences is then proposed and discussed.

Keywords: Gambling; expected utility; process utility; rationality; irrationality; consequentialism (search for similar items in EconPapers)
JEL-codes: D81 (search for similar items in EconPapers)
Date: 2001-09
New Economics Papers: this item is included in nep-mic
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (23)

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Related works:
Journal Article: A Process Approach to the Utility for Gambling (2001)
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Persistent link: https://EconPapers.repec.org/RePEc:upf:upfgen:570

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