|
Responsive Set Extension
In utility theory, the responsive set (RS) extension is an extension of a preference-relation on individual items, to a partial preference-relation of item-bundles. Example Suppose there are four items: w,x,y,z. A person states that he ranks the items according to the following total order: :w \prec x \prec y \prec z (i.e., z is his best item, then y, then x, then w). Assuming the items are independent goods, one can deduce that: :\ \prec \ – the person prefers his two best items to his two worst items; :\ \prec \ – the person prefers his best and third-best items to his second-best and fourth-best items. But, one cannot deduce anything about the bundles \, \; we do not know which of them the person prefers. The RS extension of the ranking w \prec x \prec y \prec z is a partial order on the bundles of items, that includes all relations that can be deduced from the item-ranking and the independence assumption. Definitions Let O be a set of objects and \preceq a total order ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Utility Theory
As a topic of economics, utility is used to model worth or value. Its usage has evolved significantly over time. The term was introduced initially as a measure of pleasure or happiness as part of the theory of utilitarianism by moral philosophers such as Jeremy Bentham and John Stuart Mill. The term has been adapted and reapplied within neoclassical economics, which dominates modern economic theory, as a utility function that represents a single consumer's preference ordering over a choice set but is not comparable across consumers. This concept of utility is personal and based on choice rather than on pleasure received, and so is specified more rigorously than the original concept but makes it less useful (and controversial) for ethical decisions. Utility function Consider a set of alternatives among which a person can make a preference ordering. The utility obtained from these alternatives is an unknown function of the utilities obtained from each alternative, not the sum of ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Preference (economics)
In economics and other social sciences, preference is the order that an agent gives to alternatives based on their relative utility. A process which results in an "optimal choice" (whether real or theoretical). Preferences are evaluations and concern matters of value, typically in relation to practical reasoning. The character of the preferences is determined purely by a person's tastes instead of the good's prices, personal income, and the availability of goods. However, people are still expected to act in their best (rational) interest. Rationality, in this context, means that when individuals are faced with a choice, they would select the option that maximizes self-interest. Moreover, in every set of alternatives, preferences arise. The belief of preference plays a key role in many disciplines, including moral philosophy and decision theory. The logical properties that preferences possess have major effects also on rational choice theory, which has a carryover effect on all mode ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Total Order
In mathematics, a total or linear order is a partial order in which any two elements are comparable. That is, a total order is a binary relation \leq on some set X, which satisfies the following for all a, b and c in X: # a \leq a ( reflexive). # If a \leq b and b \leq c then a \leq c ( transitive). # If a \leq b and b \leq a then a = b ( antisymmetric). # a \leq b or b \leq a (strongly connected, formerly called total). Total orders are sometimes also called simple, connex, or full orders. A set equipped with a total order is a totally ordered set; the terms simply ordered set, linearly ordered set, and loset are also used. The term ''chain'' is sometimes defined as a synonym of ''totally ordered set'', but refers generally to some sort of totally ordered subsets of a given partially ordered set. An extension of a given partial order to a total order is called a linear extension of that partial order. Strict and non-strict total orders A on a set X is a strict partial ord ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Independent Goods
Independent goods are goods that have a zero cross elasticity of demand. Changes in the price of one good will have no effect on the demand for an independent good. Thus independent goods are neither complements nor substitutes. For example, a person's demand for nails is usually independent of his or her demand for bread, since they are two unrelated types of goods. Note that this concept is subjective and depends on the consumer's personal utility function. A Cobb-Douglas utility function implies that goods are independent. For goods in quantities ''X''1 and ''X''2, prices ''p''1 and ''p''2, income ''m'', and utility function parameter ''a'', the utility function : u(X_1, X_2) = X_1^a X_2^, when optimized subject to the budget constraint that expenditure on the two goods cannot exceed income, gives rise to this demand function for good 1: X_1= am/p_1, which does not depend on ''p''2. See also * Consumer theory * Good (economics and accounting) In economics, goods are i ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Partial Order
In mathematics, especially order theory, a partially ordered set (also poset) formalizes and generalizes the intuitive concept of an ordering, sequencing, or arrangement of the elements of a set. A poset consists of a set together with a binary relation indicating that, for certain pairs of elements in the set, one of the elements precedes the other in the ordering. The relation itself is called a "partial order." The word ''partial'' in the names "partial order" and "partially ordered set" is used as an indication that not every pair of elements needs to be comparable. That is, there may be pairs of elements for which neither element precedes the other in the poset. Partial orders thus generalize total orders, in which every pair is comparable. Informal definition A partial order defines a notion of comparison. Two elements ''x'' and ''y'' may stand in any of four mutually exclusive relationships to each other: either ''x'' ''y'', or ''x'' and ''y'' are ''incompar ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Transitive Closure
In mathematics, the transitive closure of a binary relation on a set is the smallest relation on that contains and is transitive. For finite sets, "smallest" can be taken in its usual sense, of having the fewest related pairs; for infinite sets it is the unique minimal transitive superset of . For example, if is a set of airports and means "there is a direct flight from airport to airport " (for and in ), then the transitive closure of on is the relation such that means "it is possible to fly from to in one or more flights". Informally, the ''transitive closure'' gives you the set of all places you can get to from any starting place. More formally, the transitive closure of a binary relation on a set is the transitive relation on set such that contains and is minimal; see . If the binary relation itself is transitive, then the transitive closure is that same binary relation; otherwise, the transitive closure is a different relation. Conversely, transitive ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Injective Function
In mathematics, an injective function (also known as injection, or one-to-one function) is a function that maps distinct elements of its domain to distinct elements; that is, implies . (Equivalently, implies in the equivalent contrapositive statement.) In other words, every element of the function's codomain is the image of one element of its domain. The term must not be confused with that refers to bijective functions, which are functions such that each element in the codomain is an image of exactly one element in the domain. A homomorphism between algebraic structures is a function that is compatible with the operations of the structures. For all common algebraic structures, and, in particular for vector spaces, an is also called a . However, in the more general context of category theory, the definition of a monomorphism differs from that of an injective homomorphism. This is thus a theorem that they are equivalent for algebraic structures; see for more details. ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Stochastic Dominance
Stochastic dominance is a partial order between random variables. It is a form of stochastic ordering. The concept arises in decision theory and decision analysis in situations where one gamble (a probability distribution over possible outcomes, also known as prospects) can be ranked as superior to another gamble for a broad class of decision-makers. It is based on shared preferences regarding sets of possible outcomes and their associated probabilities. Only limited knowledge of preferences is required for determining dominance. Risk aversion is a factor only in second order stochastic dominance. Stochastic dominance does not give a total order, but rather only a partial order: for some pairs of gambles, neither one stochastically dominates the other, since different members of the broad class of decision-makers will differ regarding which gamble is preferable without them generally being considered to be equally attractive. Throughout the article, \rho, \nu stand for probabil ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Additive Utility
In economics, additive utility is a cardinal utility function with the sigma additivity property. Additivity (also called ''linearity'' or ''modularity'') means that "the whole is equal to the sum of its parts." That is, the utility of a set of items is the sum of the utilities of each item separately. Let S be a finite set of items. A cardinal utility function u:2^S\to\R, where 2^S is the power set of S, is additive if for any A, B\subseteq S, :u(A)+u(B)=u(A\cup B)-u(A\cap B). It follows that for any A\subseteq S, :u(A)=u(\emptyset)+\sum_\big(u(\)-u(\emptyset)\big). An additive utility function is characteristic of independent goods. For example, an apple and a hat are considered independent: the utility a person receives from having an apple is the same whether or not he has a hat, and vice versa. A typical utility function for this case is given at the right. Notes * As mentioned above, additivity is a property of cardinal utility functions. An analogous property of ordinal ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Journal Of Economic Theory
The ''Journal of Economic Theory'' is a bimonthly peer-reviewed academic journal covering the field of economic theory. Karl Shell has served as editor-in-chief of the journal since it was established in 1968. Since 2000, he has shared the editorship with Jess Benhabib, Alessandro Lizzeri, Christian Hellwig, and more recently with Alessandro Pavan, Ricardo Lagos, Marciano Siniscalchi, and Xavier Vives. The journal is published by Elsevier. In 2020, Tilman Börgers was chief editor of the journal. Abstracting and indexing According to the ''Journal Citation Reports'', the journal has a 2020 impact factor of 1.458. See also *List of economics journals The following is a list of scholarly journals in economics containing most of the prominent academic journals in economics. Popular magazines or other publications related to economics, finance, or business are not listed. A *'' Affilia'' *''A ... References External links * Economics journals Elsevier academic jou ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Additive Function
In number theory, an additive function is an arithmetic function ''f''(''n'') of the positive integer variable ''n'' such that whenever ''a'' and ''b'' are coprime, the function applied to the product ''ab'' is the sum of the values of the function applied to ''a'' and ''b'':Erdös, P., and M. Kac. On the Gaussian Law of Errors in the Theory of Additive Functions. Proc Natl Acad Sci USA. 1939 April; 25(4): 206–207online/ref> f(a b) = f(a) + f(b). Completely additive An additive function ''f''(''n'') is said to be completely additive if f(a b) = f(a) + f(b) holds ''for all'' positive integers ''a'' and ''b'', even when they are not coprime. Totally additive is also used in this sense by analogy with totally multiplicative functions. If ''f'' is a completely additive function then ''f''(1) = 0. Every completely additive function is additive, but not vice versa. Examples Examples of arithmetic functions which are completely additive are: * The restriction of the Logarithm ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
Weakly Additive
In fair division, a topic in economics, a preference relation is weakly additive if the following condition is met: : If A is preferred to B, and C is preferred to D (and the contents of A and C do not overlap) then A together with C is preferable to B together with D. Every additive utility function is weakly-additive. However, additivity is applicable only to cardinal utility functions, while weak additivity is applicable to ordinal utility functions. Weak additivity is often a realistic assumption when dividing up goods between claimants, and simplifies the mathematics of certain fair division problems considerably. Some procedures in fair division do not need the value of goods to be additive and only require weak additivity. In particular the adjusted winner procedure only requires weak additivity. Cases where weak additivity fails Case where the assumptions might fail would be either *The value of A and C together is the less than the sum of their values. For instance ... [...More Info...] [...Related Items...] OR: [Wikipedia] [Google] [Baidu] |
