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In Search of a Pointless Decision Principle

Published online by Cambridge University Press:  28 February 2022

Prasanta S. Bandyopadhayay
Prasanta S. Bandyopadhayay*
Affiliation:
University of Rochester
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Extract

“Maximizing expected utility (MEU)” is one assumption of (strict) Bayesian decision theory [Savage 1972]. According to the principle of MEU, in a given decision situation, the decision maker should choose one of the alternatives with maximal expected utility [For an excellent discussion of decision theory, see Jeffrey 1990]. However, MEU as the foundation of Bayesian decision theory has been under attack. One counterexample that seems to dispute MEU as a rationality principle is offered by Daniel Ellsberg[Ellsberg 1961]. While discussing what has been dubbed as the Ellsberg paradox, I will consider briefly three decision principles, each of which is different from the MEU principle.

Type
Part VII. Statistics and Experimental Reasoning
Information
PSA: Proceedings of the Biennial Meeting of the Philosophy of Science Association , Volume 1994 , Issue 1: Volume One: Contributed Papers 1994 , 1994 , pp. 260 - 269
Copyright
Copyright © 1994 by the Philosophy of Science Association

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Footnotes

1

The author acknowledges his debt to Prasun Basu, John G. Bennett, Abhijit Dasgupta, Deepnarayan Gupta, Jack Hall, Henry Kyburg Jr., Isaac Levi, Patrick Maher, Michael Mathias, Abhaya Nayak, Nihls-Eric Sahlin, Paul Weirich for their suggestions and comments on earlier versions of the paper and to Peter G. Found for suggesting to him the title of the paper. John G. Bennett deserves special mention for helping him in thinking through the difficult areas of decision theory.

References

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