This is the classic work upon which modern-day game theory is based. What began as a modest proposal that a mathematician and an economist write a short paper together blossomed, when Princeton University Press published Theory of Games and Economic Behavior. In it, John von Neumann and Oskar Morgenstern conceived a groundbreaking mathematical theory of economic and social organization, based on a theory of games of strategy. Not only would this revolutionize economics, but the entirely new field of scientific inquiry (...) it yielded--game theory--has since been widely used to analyze a host of real-world phenomena from arms races to optimal policy choices of presidential candidates, from vaccination policy to major league baseball salary negotiations. And it is today established throughout both the social sciences and a wide range of other sciences. (shrink)

When making decisions, people naturally face uncertainty about the potential consequences of their actions due in part to limits in their capacity to represent, evaluate or deliberate. Nonetheless, they aim to make the best decisions possible. In Decision Theory with a Human Face, Richard Bradley develops new theories of agency and rational decision-making, offering guidance on how 'real' agents who are aware of their bounds should represent the uncertainty they face, how they should revise their opinions as a result of (...) experience and how they should make decisions when lacking full awareness of, or precise opinions on relevant contingencies. He engages with the strengths and flaws of Bayesian reasoning, and presents clear and comprehensive explorations of key issues in decision theory, from belief and desire to semantics and learning. His book draws on philosophy, economics, decision science and psychology, and will appeal to readers in all of these disciplines. (shrink)

This article argues that Lara Buchak’s risk-weighted expected utility (REU) theory fails to offer a true alternative to expected utility theory. Under commonly held assumptions about dynamic choice and the framing of decision problems, rational agents are guided by their attitudes to temporally extended courses of action. If so, REU theory makes approximately the same recommendations as expected utility theory. Being more permissive about dynamic choice or framing, however, undermines the theory’s claim to capturing a steady choice disposition in the (...) face of risk. I argue that this poses a challenge to alternatives to expected utility theory more generally. (shrink)

In Risk and Rationality, Lara Buchak advertised REU theory as able to recover the modal preferences in the Allais paradox. But we pointed out that REU theory only applies in the “grand world” setting, where it actually struggles with the modal Allais preferences. Buchak offers two replies. Here we enumerate technical and philosophical problems they face.

According to the orthodox treatment of risk preferences in decision theory, they are to be explained in terms of the agent's desires about concrete outcomes. The orthodoxy has been criticised both for conflating two types of attitudes and for committing agents to attitudes that do not seem rationally required. To avoid these problems, it has been suggested that an agent's attitudes to risk should be captured by a risk function that is independent of her utility and probability functions. The main (...) problem with that approach is that it suggests that attitudes to risk are wholly distinct from people's (non-instrumental) desires. To overcome this problem, we develop a framework where an agent's utility function is defined over chance propositions (i.e., propositions describing objective probability distributions) as well as ordinary (non-chance) ones, and argue that one should explain different risk attitudes in terms of different forms of the utility function over such propositions. (shrink)

A moderately risk averse person may turn down a 50/50 gamble that either results in her winning $200 or losing $100. Such behaviour seems rational if, for instance, the pain of losing $100 is felt more strongly than the joy of winning $200. The aim of this paper is to examine an influential argument that some have interpreted as showing that such moderate risk aversion is irrational. After presenting an axiomatic argument that I take to be the strongest case for (...) the claim that moderate risk aversion is irrational, I show that it essentially depends on an assumption that those who think that risk aversion can be rational should be skeptical of. Hence, I conclude that risk aversion need not be irrational. (shrink)

Chance Neutrality is the thesis that, conditional on some proposition being true, its chance of being true should be a matter of practical indifference. The aim of this article is to examine whether Chance Neutrality is a requirement of rationality. We prove that given Chance Neutrality, the Principal Principle entails a thesis called Linearity; the centerpiece of von Neumann and Morgenstern’s expected utility theory. With this in mind, we argue that the Principal Principle is a requirement of practical rationality but (...) that Linearity is not and, hence, that Chance Neutrality is not rationally required. (shrink)

This paper offers a novel account of how complaints of unfairness arise in risky distributive cases. According to a recently proposed view in distributive ethics, the Competing Claims View, an individual has a claim to a benefit when her well-being is at stake, and the strength of this claim is determined by the expected gain to the individual’s well-being, along with how worse off the individual is compared to others. If an individual is at a lower level of well-being than (...) another, their claim to a given benefit is stronger. On this view, the strength of individuals’ claims are a function of their comparative well-being levels. In this paper, I instead argue that competing claims obtain only when a particular relationship obtains between the fates of individuals: that one individual’s gain is at the expense of another. This is a particular complaint that obtains when the fates of individuals are tied together in such a way that inequality that is to the detriment of the person who is worse off is guaranteed to obtain. I demonstrate that this complaint arises only when individuals are exposed to a particular type of risk that allows some to gain only if others lose. As such, I propose that complaints of unfairness occur less frequently than we might think if we take the Competing Claims View to be true. A purely comparative view is unable to account for this unique complaint of unfairness. I argue that this complaint is not only independently plausible, but can serve as a foundation for a more general account of competing claims complaints. (shrink)

There are decision problems where the preferences that seem rational to many people cannot be accommodated within orthodox decision theory in the natural way. In response, a number of alternatives to the orthodoxy have been proposed. In this paper, I offer an argument against those alternatives and in favour of the orthodoxy. I focus on preferences that seem to encode sensitivity to risk. And I focus on the alternative to the orthodoxy proposed by Lara Buchak’s risk-weighted expected utility theory. I (...) will show that the orthodoxy can be made to accommodate all of the preferences that Buchak’s theory can accommodate. (shrink)

It is well known that there is a conflict between three intuitive principles for the evaluation of risky prospects in distributional contexts, Ex-Post Egalitarianism, Ex-Ante Pareto and Dominance. In this paper, I return to Peter Diamond’s suggestion that we reject Dominance as a principle of rationality in distributional contexts and present a new argument in support of this position. The argument is based on an observation regarding the right way for a distributor to weigh reasons for actions. In some cases, (...) I argue, reasons for action that are grounded in the interests of one of the patients ought to be disregarded by the distributor. These cases share the following property: it is in the patient’s overall interest that the distributor disregards them. I show that Dominance does not permit distributors to disregard such reasons and use this observation to argue against the claim that Dominance is a principle of rationality in distributional contexts. (shrink)

The Pareto principle states that if the members of society express the same preference judgment between two options, this judgment is compelling for society. A building block of normative economics and social choice theory, and often borrowed by contemporary political philosophy, the principle has rarely been subjected to philosophical criticism. The paper objects to it on the ground that it indifferently applies to those cases in which the individuals agree on both their expressed preferences and their reasons for entertaining them, (...) and those cases in which they agree on their expressed preferences, while differing on their reasons. The latter are cases of "spurious unanimity", and it is normatively inappropriate, or so the paper argues, to defend unanimity preservation at the social level for them, so the Pareto principle is formulated much too broadly. The objection seems especially powerful when the principle is applied in an ex ante context of uncertainty, in which individuals can disagree on both their probabilities and utilities, and nonetheless agree on their preferences over prospects. (shrink)

A natural view in distributive ethics is that everyone's interests matter, but the interests of the relatively worse off matter more than the interests of the relatively better off. I provide a new argument for this view. The argument takes as its starting point the proposal, due to Harsanyi and Rawls, that facts about distributive ethics are discerned from individual preferences in the "original position." I draw on recent work in decision theory, along with an intuitive principle about risk-taking, to (...) derive the view. (shrink)

The Uniqueness Thesis holds, roughly speaking, that there is a unique rational response to any particular body of evidence. We first sketch some varieties of Uniqueness that appear in the literature. We then discuss some popular views that conflict with Uniqueness and others that require Uniqueness to be true. We then examine some arguments that have been presented in its favor and discuss why permissivists find them unconvincing. Last, we present some purported counterexamples that have been raised against Uniqueness and (...) discuss some possible reasons why proponents of Uniqueness might find these similarly unconvincing. (shrink)

"[This book] proposes new foundations for the Bayesian principle of rational action, and goes on to develop a new logic of desirability and probabtility."—Frederic Schick, _Journal of Philosophy_.

We study the representation of attitudes to risk in Jeffrey’s decision-theoretic framework suggested by Stefánsson and Bradley :602–625, 2015; Br J Philos Sci 70:77–102, 2017) and Bradley :231–248, 2016; Decisions theory with a human face, Cambridge University Press, Cambridge, 2017). We show that on this representation, the value of any prospect may be expressed as a sum of two components, the prospect’s instrumental value and the prospect’s intrinsic value. Both components have an expectational form. We also make a distinction between (...) a prospect’s overall intrinsic value and a prospect’s conditional intrinsic value given each one of its possible outcomes and argue that this distinction has great explanatory power. We explore the relation between these two types of intrinsic values and show that they are determined at the level of preferences. Finally, we explore the relation between the intrinsic values of different prospects and point to a strong restriction on this relation that is implicit in Jeffrey’s axioms. We suggest a natural interpretation to this restriction. (shrink)

I have claimed that risk-weighted expected utility maximizers are rational, and that their preferences cannot be captured by expected utility theory. Richard Pettigrew and Rachael Briggs have recently challenged these claims. Both authors argue that only EU-maximizers are rational. In addition, Pettigrew argues that the preferences of REU-maximizers can indeed be captured by EU theory, and Briggs argues that REU-maximizers lose a valuable tool for simplifying their decision problems. I hold that their arguments do not succeed and that my original (...) claims still stand. However, their arguments do highlight some costs of REU theory. (shrink)

Risk-weighted expected utility theory permits preferences which violate the Sure-Thing Principle. But preferences that violate the STP can lead to bad decisions in sequential choice problems. In particular, they can lead decision-makers to adopt a strategy that is dominated – i.e. a strategy such that some available alternative leads to a better outcome in every possible state of the world.

Lara Buchak sets out a new account of rational decision-making in the face of risk. She argues that the orthodox view is too narrow, and suggests an alternative, more permissive theory: one that allows individuals to pay attention to the worst-case or best-case scenario, and vindicates the ordinary decision-maker.

This study uses techniques from economics to illuminate fundamental questions in ethics, particularly in the foundations of utilitarianism. Topics considered include the nature of teleological ethics, the foundations of decision theory, the value of equality and the moral significance of a person's continuing identity through time.

Classic analysis of the subject and the development of personal probability; one of the greatest controversies in modern statistcal thought.

Policy-makers must sometimes choose between an alternative which has somewhat lower expected value for each person, but which will substantially improve the outcomes of the worst off, or an alternative which has somewhat higher expected value for each person, but which will leave those who end up worst off substantially less well off. The popular ex ante Pareto principle requires the choice of the alternative with higher expected utility for each. We argue that ex ante Pareto ought to be rejected (...) because it conflicts with the requirement that, when possible, one ought to decide as one would with full information. We apply our argument in an analysis of US policy on screening for breast cancer. -/- . (shrink)

This paper re-examines the welfare economics of risk. It singles out a class of criteria, the “expected equally-distributed equivalent”, as the unique class which avoids serious drawbacks of existing approaches. Such criteria behave like ex-post criteria when the final statistical distribution of wellbeing is known ex ante, and like ex-ante criteria when risk generates no inequality. The paper also provides a new result on the tension between inequality aversion and respect of individual ex ante preferences, in the vein of Harsanyi’s (...) aggregation theorem. (shrink)

Within philosophy of action, there are three broad views about what, in addition to beliefs, answer the question of “what to do?” and so determine an agent’s motivation: desires, judgments about values/reasons, or states of the will, such as intentions. We argue that recent work in decision theory vindicates the volitionalist. “What to do?” isn’t settled by “what do I value” or “what reasons are there?” Rational motivation further requires determining how to trade off the possibility of a good outcome (...) against the possibility of a bad one—i.e., determining how much of a risk to take. The risk attitudes that embody this tradeoff seem best understood as intentions: as self-governing policies to weight desires or reasons in certain ways. That we need to settle our risk attitudes before making most decisions corroborates Bratman’s claim that self-governing policies are required for resolving impasses of evaluative and normative underdetermination. Moreover, far from being rare or confined to tie-breakings, cases that are underdetermined but for one’s risk attitudes are typical of everyday decision-making. The will is required for most rational action. (shrink)