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The quasilinear quadratic utility model : an overview

Choné, Philippe; Linnemer, Laurent - 2019

The quasi-linear quadratic utility model is widely used in economics. The knowledge of its exact origin is less widespread. A first contribution of the paper is to explain the genesis of this model. Next, we review the main properties of the general model, mainly following the previous...

Persistent link: https://www.econbiz.de/10012016062

Apportioning of risks via stochastic dominance

Eeckhoudt, Louis R. (contributor); … - 2008

Consider a simple two-state risk with equal probabilities for the two states. In particular, assume that the random wealth variable Xi dominates Yi via ith-order stochastic dominance for i = M,N. We show that the 50-50 lottery [XN + YM, YN + XM] dominates the lottery [XN + XM, YN + YM] via (N +...

Persistent link: https://www.econbiz.de/10003790970

Sectoral uncertainty

Castelnuovo, Efrem; Tuzcuoglu, Kerem; Uzeda, Luis - 2022

We propose a new empirical framework that jointly decomposes the conditional variance of economic time series into a common and a sector-specific uncertainty component. We apply our framework to a large dataset of disaggregated industrial production series for the US economy. Our results...

Persistent link: https://www.econbiz.de/10013419275

A two-ball Ellsberg paradox

Jabarian, Brian; Lazarus, Simon - 2023

avoid ambiguity even when it means choosing dominated options. In contrast to the literature, we find that 55% of subjects … that such a preference is not mainly due to a lack of understanding. We conclude that subjects avoid ambiguity per se … rather than avoiding ambiguity because it may yield a worse outcome. Such behavior cannot be reconciled with existing models …

Persistent link: https://www.econbiz.de/10014426529

The invariant distribution of wealth and employment status in a small open economy with precautionary savings

Bayer, Christian; Rendall, Alan D.; Wälde, Klaus - 2018

source of uncertainty in a small open economy. We prove the existence of an optimal consumption path. We exploit that the …

Persistent link: https://www.econbiz.de/10011941404

Emotion research in economics

Wälde, Klaus - 2016

Emotions were central to the development of economics, especially in utility theory in classical economics. While neoclassical utility theory basically abolished emotions, behavioural economics more recently reintroduced emotions in utility theory. Beyond utility theory, economic theorists use...

Persistent link: https://www.econbiz.de/10011499845

A fairness justification of utilitarianism

Piacquadio, Paolo G. - 2016

Differences in preferences are important to explain variation in individuals' behavior. There is however no consensus on how to take these differences into account when evaluating policies. While prominent in the economic literature, the standard utilitarian criterion faces two major...

Persistent link: https://www.econbiz.de/10011434634

Beliefs and utility : experimental evidence on preferences for information

Falk, Armin; Zimmermann, Florian - 2016

Beliefs are a central determinant of behavior. Recent models assume that beliefs about or the anticipation of future consumption have direct utilityconsequences. This gives rise to informational preferences, i.e., preferences over the timing and structure of information. Using a novel and...

Persistent link: https://www.econbiz.de/10011523747

The connexion between old and new approaches to financial satisfaction

Praag, Bernard M. S. van - 2004

In this paper we compare the new satisfaction evaluation approach, developed in the nineties by Oswald, Clark, Blanchflower and others with the older income evaluation (IEQ) approach, developed by Van Praag and Kapteyn in the seventies of the previous century. We find that both approaches yield...

Persistent link: https://www.econbiz.de/10011449347

Theoretical and practical arguments for modeling labor supply as a choice among latent jobs

Dagsvik, John K.; Jia, Zhiyang; Kornstad, Tom; … - 2012

Models of labor supply derived from stochastic utility representations and discretized sets of feasible hours of work have gained popularity because they are more practical than the standard approaches based on marginal calculus. In this paper we argue that practicality is not the only feature...

Persistent link: https://www.econbiz.de/10009488981

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