This paper considers the effects of changes in risk on optimal decisions under risk in an analytical framework assuming … only utility-representable preferences that is capable of replicating and extending important results obtained in the EU … equivalence between behavioral assumptions and the characteristics of the utility function, which are in turn necessary and …

space S and outcome space X with topological structures. We axiomatically characterize a Subjective Expected Utility (SEU …) representation of conditional preferences, involving a continuous utility function on X (unique up to positive affine transformations …

expected utility (GEU) to the diversification of agents who maximize the conventional expected utility (EU). Specifically, we … derive the patterns of diversification for agents who maximize a rank-dependent' expected utility, attaching more weight to … bad' than to good' outcomes, in contrast to the probability weights used in a conventional expected utility maximization …