This paper develops a theory for probabilistic models for risky choices that can be viewed as an extension of the expected utility theory to account for bounded rationality. One probabilistic version of the Archimedean Axiom and two versions of the Independence Axiom are proposed. In addition,...

This paper develops a theory for probabilistic models for risky choices that can be viewed as an extension of the expected utility theory to account for bounded rationality. One probabilistic version of the Archimedean Axiom and two versions of the Independence Axiom are proposed. In addition,...

This paper discusses the problem of specifying probabilistic models for choices (strategies) with uncertain outcomes. The point of departure is an extension of the axiom system of the von Neumann-Morgenstern Expected utility theory to the case when the preferences are stochastic. This extended...

An important problem in the analysis of intertemporal choice processes is how to justify the choice of mathematical structure of the transition probabilities. A related and delicate identification problem is to separate the effect of unobserved variables from the influence on preferences from...

This paper develops a theory of probabilistic models for risky choices. Part of this theory can be viewed as an extension of the expected utility theory to account for bounded rationality. One probabilistic version of the Archimedean Axiom and two versions of the Independence Axiom are proposed....

This paper discusses the problem of specifying probabilistic models for choices (strategies) with uncertain outcomes. The most general case we consider is choice settings where the uncertain outcomes are sets which may contain more than one alternative. This is of interest for the following type...

This paper proposes a particular behavioral assumption to characterize the stochastic structure of intertemporal discrete choice models in the absence of state dependence. This assumption extends Luce's axiom; Independence from Irrelevant Alternatives, to the intertemporal context. Under certain...