Duhemian Themes in Expected Utility Theory

Mongin, Philippe

doi:10.1007/978-1-4020-9368-5_13

Cited by 34 publications

(23 citation statements)

References 47 publications

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“…Mainstream Expected Utility Theory (EUT) purports that decisions between alternatives are made on the basis of the utility value of outcomes [13]. This value is based on the probability of a given outcome for each choice.…”

Section: Residential Energy Demand Behaviourmentioning

confidence: 99%

Case Study Evidence and Behavioural Analysis of Residential Energy Consumption in the UK

Hallin¹,

Hooper²,

Weyman‐Jones³

2017

OJEE

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This paper investigates residential energy consumption in the UK by using a novel and topical approach based on behavioural analysis. A key lesson from recent advances in behavioural economics is that the responses of individuals to both policy incentives and uncertainty may differ from the predictions of classical rational optimising behaviour. By employing a focused case study approach using both quantitative and qualitative response analysis, it considers the motivations of residential householders in the UK to reduce fossil fuel use, with additional perspectives from UK landlords, a global environmental NGO, a senior politician, and two senior stakeholder strategy managers from a large energy company. Our interpretative behavioural analysis shows that a variety of incentives are necessary to encourage behaviour change. However, case study participants largely agree on the beneficial role of government regulation and efforts to "nudge" them in the right direction with regard to their energy use. As a means of more effectively reducing carbon dioxide emissions, we conclude that policy should focus on sustainable energy use. The findings allow us to understand why important recent policy initiatives such as the UK Green Deal failed to achieve their objectives and they suggest lessons for more effective incentive based policy making in the field of residential energy consumption.

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Section: Residential Energy Demand Behaviourmentioning

confidence: 99%

Case Study Evidence and Behavioural Analysis of Residential Energy Consumption in the UK

Hallin¹,

Hooper²,

Weyman‐Jones³

2017

OJEE

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“…Between the late 1940s and early 1950s, von Neumann and Morgenstern's axiomatic version of EUT generated an intense debate in which many major economists of the period took part. By 1952-1953, however, a substantial consensus on EUT had formed, at least among American economists (Mongin, 2009;Moscati, 2016). Finally, since the expected utility formula features a cardinal utility function, i.e.…”

Section: Introductionmentioning

confidence: 99%

Measurement theory and utility analysis in Suppes’ early work, 1951–1958

Moscati

2016

Journal of Economic Methodology

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The paper reconstructs the connections between the evolution of Patrick Suppes' measurement theory from 1951 to 1958 and the research in utility analysis he conducted between 1953 and 1957 within the Stanford Value Theory Project. In particular, the paper shows that Suppes' superseding of the classical understanding of measurement, his endorsement of the representational view of measurement, and his conceiving of an axiomatic version of the latter were prompted by his research in utility analysis.

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“…Simon, 1979). Expected utility theory (EUT) attempts to address this shortcoming by incorporating probabilities of outcomes into the decision making process, effectively weighting each choice in these terms (Friedman & Savage, 1952;Mongin, 1997). Despite the fairly ubiquitous acceptance of EUT on a normative level, the theory has been challenged in terms of its descriptive validity, as assigning numerical values to constructs such as utility and probability has proven difficult (Friedman & Savage, 1952;Kahneman & Tversky, 1979;Mongin, 1997).…”

Section: A Brief Historymentioning

confidence: 99%

“…Expected utility theory (EUT) attempts to address this shortcoming by incorporating probabilities of outcomes into the decision making process, effectively weighting each choice in these terms (Friedman & Savage, 1952;Mongin, 1997). Despite the fairly ubiquitous acceptance of EUT on a normative level, the theory has been challenged in terms of its descriptive validity, as assigning numerical values to constructs such as utility and probability has proven difficult (Friedman & Savage, 1952;Kahneman & Tversky, 1979;Mongin, 1997). Additionally, a number of alternative postulations and theories such as the Ellsberg paradox (Ellsberg, 1961), prospect theory (Kahneman & Tversky, 1979), the Allais paradox (Allais, 1979), and the framing effect (Tversky & Kahneman, 1981, 1986, have empirically shown how actual decision making processes consistently violate the axioms underpinning EUT.…”

Section: A Brief Historymentioning

confidence: 99%

Exploring Procedural Decision Support Systems for Wicked Problem Resolution

Pretorius¹

2017

SACJ

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Wicked problems are hyper-complex problems that are not solvable via traditional methods. Some common examples of these include issues such as poverty, climate change, business strategy, and general policy development, which all have high stakes and no straightforward solution. The ambiguity of these problems can be particularly frustrating for the individuals and organizations that encounter them, as the very essence of these problems is elastic and unstable. Additionally, attempts to tame wicked problems tend to be irrevocable — for better or for worse — as the problem itself shifts in unpredictable ways in response. Decision support systems (DSSs) have long been considered a panacea for a number of highly complex problems in light of their potential to store, retrieve, and manipulate information to aid decision making. However, classical DSSs, being originally intended for semi-structured types of problems, are rendered practically impotent in the presence of wicked problems and their associated complexities. Thus, this article investigates the possibility of DSSs that rely on procedural rationality as an alternative strategy for resolving wicked problems. An empirical literature review is utilized to build and present an integrated, descriptive model for the design, development, and use of such DSSs for resolving wicked problems.

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Duhemian Themes in Expected Utility Theory

Cited by 34 publications

References 47 publications

Case Study Evidence and Behavioural Analysis of Residential Energy Consumption in the UK

Case Study Evidence and Behavioural Analysis of Residential Energy Consumption in the UK

Measurement theory and utility analysis in Suppes’ early work, 1951–1958

Exploring Procedural Decision Support Systems for Wicked Problem Resolution

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