The impossibility of compromise: some uniqueness properties of expected utility preferences

Citation
P. Ghirardato et M. Marinacci, The impossibility of compromise: some uniqueness properties of expected utility preferences, ECON THEORY, 16(2), 2000, pp. 245-258
Citations number
16
Categorie Soggetti
Economics
Journal title
ECONOMIC THEORY
ISSN journal
09382259 → ACNP
Volume
16
Issue
2
Year of publication
2000
Pages
245 - 258
Database
ISI
SICI code
0938-2259(200009)16:2<245:TIOCSU>2.0.ZU;2-T
Abstract
We focus on the following uniqueness property of expected utility preferenc es: Agreement of two preferences on one interior indifference class implies their equality. We show that, besides expected utility preferences under ( objective) risk, this uniqueness property holds for subjective expected uti lity preferences in Anscombe-Aumann's (partially subjective) and Savage's ( fully subjective) settings, while it does not hold for subjective expected utility preferences in settings without rich state spaces. Indeed, when it holds the uniqueness property is even stronger than described above, as it needs only agreement on binary acts. The extension of the uniqueness proper ty to the subjective case is possible because beliefs in the mentioned sett ings are shown to satisfy an analogous property: If two decision makers agr ee on a likelihood indifference class, they must have identical beliefs.