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on Utility Models and Prospect Theory |
| By: | Guo, Xu; Wong, Wing-Keung; Zhu, Lixing |
| Abstract: | In this paper we first develop a theory of almost stochastic dominance for risk-seeking investors to the first three orders. Thereafter, we study the relationship between the preferences of almost stochastic dominance for risk-seekers with that for risk averters. |
| Keywords: | Almost Stochastic Dominance, expected-utility maximization, risk averters, risk seekers. |
| JEL: | C0 D81 G11 |
| Date: | 2014–02–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:53347&r=upt |
| By: | Calford, Evan; Chakraborty, Anujit; Fenig, Guidon; Halevy, Yoram |
| Abstract: | We evaluate Andreoni and Sprenger's (2012) data for demand, wealth and impatience monotonicity. We find that violations for all three measures are concentrated in subjects who make interior choices and thereby take advantage of the novel feature of Andreoni and Sprenger's experimental design. Wealth monotonicity violations are more prevalent and pronounced than either demand or impatience monotonicity violations. We believe that the frequency and magnitude of monotonicity violations pose a challenge to rationalizing choices with a utility function whose corresponding demand satisfies the three monotonicity conditions. |
| Keywords: | design of experiments |
| JEL: | C91 D90 |
| Date: | 2014–08–07 |
| URL: | http://d.repec.org/n?u=RePEc:ubc:pmicro:yoram_halevy-2014-37&r=upt |
| By: | Jan Heufer; Per Hjertstrand |
| Abstract: | This article provides a robust non-parametric approach to demand analysis based on a concept called homothetic efficiency. Homotheticity is a useful restriction or assumption but data rarely satisfy testable conditions. To overcome this problem, this article provides a way to estimate homothetic efficiency of consumption choices by consumers. |
| Keywords: | Demand theory; efficiency; experimental economics; homotheticity; non-parametric analysis; revealed preference; utility maximisation |
| JEL: | C14 D11 D12 |
| Date: | 2014–08 |
| URL: | http://d.repec.org/n?u=RePEc:rwi:repape:0496&r=upt |
| By: | Charles Yuji Horioka |
| Abstract: | This paper provides an introduction to the field of evolutionary economics with emphasis on the evolutionary theory of household behavior. It shows that the goal of evolutionary economics is to improve upon neoclassical economics by incorporating more realistic and empirically grounded behavioral assumptions and technological innovation and that the goal of the evolutionary theory of household behavior is to improve upon the neoclassical theory of household behavior by replacing the neoclassical assumption of selfish utility maximization with bounded rationality and satisficing and by incorporating the reaction of households to the introduction of new goods and services. The paper concludes with a brief discussion of loss aversion and self-interest vs. altruism. |
| Date: | 2014–08 |
| URL: | http://d.repec.org/n?u=RePEc:dpr:wpaper:0912&r=upt |
| By: | Arem, Rim |
| Abstract: | This paper concerns assimilation between physiques and economics. Assuming fixed time value of goods each year along with a new concept of empty goods and its interpretation on good’s exchange. We redefined the economy and briefly described the macroeconomic, the microeconomic and Islamic economic and changed the game theory and presented a new utility of gambling. |
| Keywords: | Exchange goods, Relativity theory, Islamic economy, Game theory, and utility of gambling. |
| JEL: | A11 A12 D51 G1 Z12 |
| Date: | 2014–07–03 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:57947&r=upt |
| By: | Federico Etro (Department of Economics, University Of Venice Cà Foscari); Paolo Bertoletti (Department of Economics, University Of Pavia) |
| Abstract: | We provide a unified approach to imperfect (monopolistic, Bertrand and Cournot) competition equilibria with demand functions derived from symmetric preferences over a large but finite number of goods. The equilibrium markups depend on the Morishima Elasticity of Substitution/Complementarity between goods, and can be derived directly from the utility functions and ranked unambiguously. We characterize the endogenous market structures, their dependence on market size, income and firms’ productivity and compare them with the optimal allocations. Finally, we apply our results to the case of preferences such as Generalized Leontief, Generalized linear and Generalized quadratic that we introduce in the literature on imperfect competition. |
| Keywords: | Monopolistic Competition, Imperfect Competition, Elasticity of Substitution, Free Entry |
| JEL: | J24 J31 I24 |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:ven:wpaper:2014:09&r=upt |
| By: | Üngör, Murat (Research and Monetary Policy Department, Central Bank of the Republic of Turkey, Ankara, Turkey) |
| Abstract: | Turkey has the lowest hours worked (the product of total employment and annual hours per worker, divided by the size of the working-age population) among the OECD countries. We study the changes in hours of work following Ohanian, Raffo, and Rogerson (Journal of Monetary Economics, 2008) and find that the intratemporal first-order condition from the neoclassical growth model accounts for the decline in total hours worked during 1998-2009 in Turkey. Hours worked increased in Turkey since 2009 and the model accounts for half of that increase between 2009 and 2011. Our findings suggest that time-varying taxes on consumption and labor play significant roles in explaining the hours worked in Turkey. The subsistence term is quantitatively important during 2003-2011. The presence of government consumption in the utility function does not seem very important. |
| Keywords: | Labor supply; employment; hours of work; growth model; taxes; Turkey. |
| JEL: | E13 E20 E60 J22 O50 |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:eyd:cp2013:219&r=upt |