TY - JOUR
T1 - Weighted Utility and Optimism/Pessimism
T2 - A Decision-Theoretic Foundation of Various Stochastic Dominance Orders
AU - Wang, Tao
AU - Lehrer, Ehud
N1 - Publisher Copyright:
© (2023), (American Economic Association). All Rights Reserved.
PY - 2024
Y1 - 2024
N2 - We show that a probability distribution likelihood ratio dominates another distribution if and only if, for every weighted utility function, the former is preferred over the latter. Likewise, a probability distribution hazard rate (or reverse hazard rate) dominates another distribution if and only if, the former is preferred by every optimistic (or pessimistic) decision maker.
AB - We show that a probability distribution likelihood ratio dominates another distribution if and only if, for every weighted utility function, the former is preferred over the latter. Likewise, a probability distribution hazard rate (or reverse hazard rate) dominates another distribution if and only if, the former is preferred by every optimistic (or pessimistic) decision maker.
UR - http://www.scopus.com/inward/record.url?scp=85186876074&partnerID=8YFLogxK
U2 - 10.1257/mic.20220350
DO - 10.1257/mic.20220350
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AN - SCOPUS:85186876074
SN - 1945-7669
VL - 16
SP - 210
EP - 223
JO - American Economic Journal: Microeconomics
JF - American Economic Journal: Microeconomics
IS - 1
ER -