1. Then we maximize the expected value of a concave expected utility function. 2. His work include the theory of Maxmin Expected Utility with David Schmeidler. 3. Choice under uncertainty is often characterized as the maximization of expected utility . 4. Rabin criticizes this implication of expected utility theory on grounds of implausibility. 5. Proponents of this view suggest using an expected utility calculation instead. 6. Thus we can write expected utility in terms of two moments of w: 7. Theories of bounded rationality relax one or more assumptions of standard expected utility theory . 8. This is reflected in the theory of subjective expected utility . 9. Recently, expected utility theory has been extended to arrive at more behavioral decision models. 10. If the uncertainty is uniformly distributed, then expected utility maximization becomes expected value maximization.
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