Econometrica

Journal Of The Econometric Society

An International Society for the Advancement of Economic
Theory in its Relation to Statistics and Mathematics

Edited by: Guido W. Imbens • Print ISSN: 0012-9682 • Online ISSN: 1468-0262

Econometrica: Jan, 1999, Volume 67, Issue 1

Preference for Flexibility in a Savage Framework

https://doi.org/10.1111/1468-0262.00005
p. 101-119

Klaus Nehring

We study preferences over Savage acts that map states to opportunity sets and satisfy the Savage axioms. Preferences over opportunity sets may exhibit a due to an implicit uncertainty about future preferences reflecting anticipated unforeseen contingencies. The main result of this paper characterizes maximization of the expected indirect utility in terms of an ‘Indirect Stochastic Dominance’ axiom that expresses a preference for ‘more opportunities in expectation.’ The key technical tool of the paper, a version of Möbius inversion, has been imported from the theory of nonadditive belief functions; it allows an alternative representation using Choquet integration, and yields a simple proof of Kreps' (1979) classic result.


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Supplemental Material

Supplement to "Markov Perfect Industry Dynamics with Many Firms"

Proofs and mathematical arguments for section 4.

Supplement to "The Micro Economics of Efficient Group Behavior: Identification"

General results of the paper illustrated on a parametric example.

Supplement to "Belief-free equilibria in games with incomplete information"

File contains some omitted details on the existence of belief free equilibria for two families of games that are studied in the literature on reputation.

Supplement to "Bubbles and Self-Enforcing Debt"

This file presents three extensions of the example in Section 3.

Supplement to "Testing hypotheses about the number of factors in large factor models"

A zip file that includes data and programs.

Supplement to "Testing hypotheses about the number of factors in large factor models"

A pdf file containing detailed proofs.

Supplement to "Longevity and Lifetime Labor Supply: Evidence and Implications"

Contains additional data files for manuscript.

Supplement to "Fear of Miscoordination and the Robustness of Cooperation in Dynamic Global Games with Exit"

This appendix provides additional results.

Supplement to "Inference for Parameters Defined by Moment Inequalities Using Generalized Moment Selection"

This supplement contains proofs for the manuscript.

Supplement to "Inference for Parameters Defined by Moment Inequalities Using Generalized Moment Selection"

The GAUSS code used to compute the simulation results reported in Andrews and Soares (2010)

Supplement to "Instrumental Variable Models for Discrete Outcomes"

This document gives additional graphical displays of identified sets for the binary outcome, binary endogenous varible case considered in section 3.1.3 of the manuscript.

Supplement to "Instrumental Variable Models for Discrete Outcomes"

A zip file that contains all the programs used to generate the figures in the paper, as well as a "read me" file.

Supplement to "A Unique Costly Contemplation Representation"

Additional background information for the paper as well as proofs.

Supplement to "The Distribution of Wealth and Fiscal Policy in Economics with Finitely Lived Agents"

A zip file containing four matlab programs for the paper and a descriptive pdf file.

Supplement to "The Model Confidence Set"

PDF file containing tables and four parts: Bootstrap Procedure, Inflation Forecasting, Regression Simulation, and Taylor Rules.

Supplement to "Reputation in Continuous-Time Games"

Appendix for manuscript that shows in the reputation games (section 7), if a continuous-time public randomization device is available, then a Markov perfect equilibrium in publicly randomized strategies exists under Conditions 1 and 4.

Supplement to "The Model Confidence Set"

A zip file containing replication files for the manuscript.

Supplement to "Nature or Nurture? Learning and the Geography of Female Labor Force Participation"

A zip file containing replication files for the manuscript.

Supplement to "Nature or Nurture? Learning and the Geography of Female Labor Force Participation"

This appendix contains details about the dynamic panel estimation, international evidence about labor force, details about survey data, and sources and summary statistics for all the county-level data.

Supplement to "An Anatomy of International Trade: Evidence from French Firms"

A zip file containing instructions and the replication files for the manuscript.

Supplement to "An Anatomy of International Trade: Evidence from French Firms"

A zip file containing information needed to replicate the bootstrapped standard errors.

Supplement to "An Anatomy of International Trade: Evidence from French Firms"

This file contains data, extenstions, and proofs not found within the paper.

Supplement to "CCP Estimation of Dynamic Discrete Choice Models with Unobserved Heterogeneity"

Proofs of the lemmas and theorems as well as more detailed description of the Monte Carlo exercises are provided in this appendix.

Supplement to "CCP Estimation of Dynamic Discrete Choice Models with Unobserved Heterogeneity"

A zip file containing replication files for the manuscript.

Supplement to "Inference of Signs of Interaction Effects in Simultaneous Games with Incomplete Information"

A PDF file containing additional proofs for the manuscript.

Supplement to "Inference of Signs of Interaction Effects in Simultaneous Games with Incomplete Information"

A zip file containing replication files for the manuscript.

Supplement to "Does Industrial Composition Matter for Wages? A Test of Search and Bargaining Theory"

This appendix outlines the details of the manuscript's data construction (section S.1) and the implementation of the selection correction procedure described in the main text (section S.2).  In addition, we examine the robustness of our results in a number of dimensions and provide some derivations of key equations in the main paper.

Supplement to "Status, Intertemporal Choice and Risk-Taking"

This online appendix contains the proofs of all the lemmas that do not appear in the printed appendix to the paper.  It also contains the statements of all these lemmas and details of the intervening arguments in the proofs of the propositions.  It also contains a proof of existence for a more general model that implies Proposition 3 (ii).

Supplement to "Does Industrial Composition Matter for Wages? A Test of Search and Bargaining Theory"

This zip file contains replication files for the manuscript.

Supplement to "The Revealed Preference Theory of Stable and Extremal Stable Matchings"

This appendix contains the sufficiency proof for Theorem 1.

Supplement to "Speculative Overpricing in Asset Markets with Information Flows"

Sample instructions for the subjects.

Supplement to "Speculative Overpricing in Asset Markets with Information Flows"

The replication files for the manuscript.

Supplement to "Valuing Dealers' Informational Advantage: A Study of Canadian Treasury Auctions"

Table 7: Joint Hypothesis Studentized Test Results

Supplement to "Valuing Dealers' Informational Advantage: A Study of Canadian Treasury Auctions"

This zip file contains the replication files for the manuscript.

Supplement to "Nonparametric Estimation in Random Coefficients Binary Choice Models"

This zip file contains the replication files for the manuscript.

Supplement to "Nonparametric Estimation in Random Coefficients Binary Choice Models"

This appendix contains some materials that were omitted in the manuscript as well as technical proofs.

Supplement to "Demand Fluctuations in the Ready-Mix Concrete Industry"

This appendix contains material not found in the manuscript.  It includes a description of algorithm used in the paper, more detail on data assembly, as well as robustness checks on the results in the paper.

Supplement to "Demand Fluctuations in the Ready-Mix Concrete Industry"

This zip file contains the replication files for the manuscript.

Supplement to "Modeling Earnings Dynamics"

This file contains Supplemental Appendices A,B,C,D, and E.

Supplement to "Modeling Earnings Dynamics"

This zip file contains the replication files for the manuscript.

Supplement to" A Theory of Disagreement in Repeated Games with Bargaining"

This supplemental appendix contains proofs and additional results not found in the manuscript.

Supplement to "A Theory of Optimal Inheritance Taxation"

This appendix contains proofs omitted from the main text.

Supplement to "A Theory of Optimal Inheritance Taxation"

This zip file contains the replication files for the manuscript.

Supplement to "The Elite Illusion: Achievement Effects at Boston and New York Exam Schools"

This zip file contains the replication files for the manuscript.

Supplement to "The Elite Illusion: Achievement Effects at Boston and New York Exam Schools"

This document describes the processing steps from the original data files to the analysis used in manuscript.

Supplement to "Residential Location, Work Location, and Labor Market Outcomes of Immigrants in Israel"

This zip file contains the replication files for the manuscript.

Supplement to "Firms, Destinations, and Aggregate Fluctuations"

This zip file contains the replication files for the manuscript.

Supplement to "Firms, Destinations, and Aggregate Fluctuations"

This appendix contains (I) detailed description of econometric implementation; (ii) detailed data description; (iii) additional empirical results; (iv) model extensions.

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