This paper explores two axiomatic structures of subjective expected utility assuming a finite state-space and state-dependent, connected, topological outcome-spaces. Building on the work of Karni and Schmeidler (1981) the analytical framework includes, in addition to the preference relation on...

Using a game-theoretic approach, the authors examine possible equilibrium explanations of the often-observed phenomenon that two neighboring restaurants offering similar menus nevertheless experience vastly different demands. The essential aspect of this analysis is the presence of a consumption...

This paper presents an experimental test of the theory of individual sense of fairness of Karni and Safra (2000). According to this theory individuals' choice among random procedures designed to allocate indivisible goods is motivated, in part, by concern for fairness. The experimental study is...

A definition of a social state is proposed that incorporates the notion of procedural fairness into Harsanyi's (1955) analytical framework. We show that, within the new framework, a Harsanyi-type social welfare function is immune to Diamond's (1967) criticism. Moreover, the resulting social...