Twofold multiprior preferences and failures of contingent reasoning

• 成果类型: Article
• 署名作者: Echenique, Federico; Miyashita, Masaki; Nakamura, Yuta; Pomatto, Luciano; Vinson, Jamie
• 署名单位: California Institute of Technology; Yale University; Yokohama City University
• 刊物名称: JOURNAL OF ECONOMIC THEORY
• ISSN/ISSBN: 0022-0531
• DOI: 10.1016/j.jet.2022.105448
• 发表日期: 2022
• 关键词: Decision theory; Incomplete preference; conservatism; Obvious dominance

摘要

We propose a model of incomplete twofold multiprior preferences, in which an act f is ranked above an act g only when f provides higher utility in a worst-case scenario than what g provides in a best-case scenario. The model explains failures of contingent reasoning, captured through a weakening of the state by-state monotonicity (or dominance) axiom. Our model gives rise to rich comparative statics results, as well as extension exercises, and connections to choice theory. We present an application to second-price auctions. (c) 2022 Elsevier Inc. All rights reserved.