This article contains an analysis of a simple principal-agent problem illustrating possible problems that may arise when the prinicpal ascribes to the agent subjective probabilities and utilities that are implied by the subjective expected utility model but do not represent the agent's beliefs...

In most previous work on strategic trade policy, the form of government intervention has been prescribed in advance. In this paper, the authors apply a solution concept discussed by P. D. Klemperer and M. A. Meyer (1989) for games in which the strategy space consists of the class of all...

This paper extends M. J. Machina's generalized expected utility analysis to preferences over multivariate distributions. Within the extended framework, the relation "more risk averse than" is defined, characterized, and applied to the analysis of consumption-saving decisions under risk. The...

This paper presents an experimental design that enables the elicitation of subjective probabilities of decision makers whose preferences satisfy the axioms of expected utility theory and are state-dependent. Copyright 1999 by Economics Department of the University of Pennsylvania and the Osaka...

In this paper the author develops measures of absolute risk aversion for preference relations on risky prospects that are state-dependent and are representable by Frechet differentiable, nonlinear, functionals. A comparative statics analysis of optimal air travel insurance coverage illustrates...