A Behavioral Characterization of the Likelihood Ratio Order
AbstractIt is well known that stochastic dominance is equivalent to a unanimity property for monotone expected utilities. For lotteries over a finite set of prizes, we establish an analogous relationship between likelihood ratio dominance and monotone betweenness preferences, which are an important generalization of expected utility.
CitationMihm, Maximilian, and Lucas Siga. 2021. "A Behavioral Characterization of the Likelihood Ratio Order." American Economic Review: Insights, 3 (3): 353-66. DOI: 10.1257/aeri.20200408
- D11 Consumer Economics: Theory
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