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Dynamic Consistency Implies Approximately Expected Utility Preferences

Border, Kim C. and Segal, Uzi (1992) Dynamic Consistency Implies Approximately Expected Utility Preferences. Social Science Working Paper, 821. California Institute of Technology , Pasadena, CA. (Unpublished)

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Machina has proposed a definition of dynamic consistency which admits non-expected utility functionals. We show that even under this new definition, a dynamically consistent preference relation that is differentiable becomes arbitrarily close to an expected utility preference after the realization of a low probability event.

Item Type:Report or Paper (Working Paper)
Related URLs:
URLURL TypeDescription ItemPublished Version
Border, Kim C.0000-0003-4437-0524
Additional Information:Published as Border, Kim C., and Uzi Segal. "Dynamic consistency implies approximately expected utility preferences." Journal of Economic Theory 63, no. 2 (1994): 170-188.
Group:Social Science Working Papers
Subject Keywords:nonexpected utility; dynamic consistency; decision theory; expected utility
Series Name:Social Science Working Paper
Issue or Number:821
Classification Code:JEL: 026
Record Number:CaltechAUTHORS:20170828-143106635
Persistent URL:
Usage Policy:No commercial reproduction, distribution, display or performance rights in this work are provided.
ID Code:80862
Deposited By: Jacquelyn Bussone
Deposited On:28 Aug 2017 21:40
Last Modified:03 Oct 2019 18:35

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