This study considers the optimal demand for insurance in the presence of state-dependent background uncertainty. Its uncertainty depends on the states that are clarified by the loss occurrence, which are called the loss state and no-loss state. First, we consider a situation in which the...

Higher-order differentiability is one of the common properties of von Neumann Morgenstern (vNM) utility functions used in economic applications. In particular, it is indispensable to analyze higher-order attitudes toward risk. We shall study three classes of finite-order differentiable vNM...

Unlike the traditional normative decision theories under risk, we are concerned with a unary relation, interpreted as subjective acceptability judgment, on the set of all joint probability distributions over two-attributed decision outcomes, where the first attribute describes final wealth...