Gil Riella | Universidade de Brasília - UnB (original) (raw)

Papers by Gil Riella

Mathematical Social Sciences, 2010

Social Choice and Welfare

American Economic Review

We study stochastic choice as the outcome of deliberate randomization. We derive a general repres... more We study stochastic choice as the outcome of deliberate randomization. We derive a general representation of a stochastic choice function where stochasticity allows the agent to achieve from any set the maximal element according to her underlying preferences over lotteries. We show that in this model stochasticity in choice captures complementarity between elements in the set, and thus necessarily implies violations of Regularity/Monotonicity, one of the most common properties of stochastic choice. This feature separates our approach from other models, e.g., Random Utility. (JEL D80, D81)

Econometrica

This paper begins by observing that any reflexive binary (preference) relation (over risky prospe... more This paper begins by observing that any reflexive binary (preference) relation (over risky prospects) that satisfies the independence axiom admits a form of expected utility representation. We refer to this representation notion as the coalitional minmax expected utility representation. By adding the remaining properties of the expected utility theorem, namely, continuity, completeness, and transitivity, one by one, we find how this representation gets sharper and sharper, thereby deducing the versions of this classical theorem in which any combination of these properties is dropped from its statement. This approach also allows us to weaken transitivity in this theorem, rather than eliminate it entirely, say, to quasitransitivity or acyclicity. Apart from providing a unified dissection of the expected utility theorem, these results are relevant for the growing literature on boundedly rational choice in which revealed preference relations often lack the properties of completeness and...

Theory and Decision, 2016

Working Papers Series, Jun 1, 2002

Abstract The goal of this paper is to develop, axiomatically, a reference-dependent choice model ... more Abstract The goal of this paper is to develop, axiomatically, a reference-dependent choice model that accounts,fully for the famous,attraction e¤ect. Our model,is formulated,under the premises of revealed preference theory, and hence it does not take the “reference” for an agent as exogenously given in the description of a choice problem. Instead, by suitably relaxing the WARP, we derive the existence of reference alternatives, and the choice behavior,conditioned,on those alternatives. We consider choice under,certainty and risk separately, and obtain fairly tractable models in each of these cases. As a gen- uine economic application, we reexamine the standard model of monopolistic (vertical) product,di¤erentiation where,a fraction of the demand,side of the market,is subject to the attraction e¤ect. JEL Classi…cation: D11, D81. Keywords: Revealed Preferences, Incomplete Preferences, Attraction E¤ect, Reference- Dependence, Endogeneous Reference Formation, Product Di¤erentiation. Various comments of Heski Bar-Isaac, Jean-Pierre Benoît, Alessandro Lizzeri, Yusufcan Masatlioglu, and

A great deal of the current economic debate on global warming centers on incentives for countries... more A great deal of the current economic debate on global warming centers on incentives for countries to commit to targets for abatement of greenhouse gas emissions. Will the pledge by European Union countries to significantly reduce their emissions by 2020, for instance, encourage other nations to follow suit? In this paper, we show that the socially optimal level of abatement can be achieved when there are nations that lead by example, meaning they recognize the potential for welfare improvements and undertake actions that cause others to act towards their mutual benefit. We use a novel approach and model the problem as an asymmetric game where nations have different costs of abatement and are drawn from different populations. We give conditions under which sets of strategies where players cooperate are equilibrium evolutionarily stable and show that the possibility of attaining the social optimum is linked to the configuration of the game where leadership is absent. We produce a new ...

Economic Theory, 2015

ABSTRACT Recently, there has been some interest on models of incomplete preferences under uncerta... more ABSTRACT Recently, there has been some interest on models of incomplete preferences under uncertainty that allow for incompleteness due the multiplicity of tastes and beliefs. In particular, Galaabaatar and Karni (Econometrica 81(1):255–284, 2013) work with a strict partial order and present axiomatizations of the Multi-prior Expected Multi-utility and the Single-prior Expected Multi-utility representations. In this paper, we characterize both models using a preorder as the primitive. In the case of the Multi-prior Expected Multi-utility representation, like all the previous axiomatizations of this model in the literature, our characterization works under the restriction of a finite prize space. In our axiomatization of the Single-prior Expected Multi-utility representation, the space of prizes is a compact metric space. Later in the paper, we present two applications of our characterization of the Single-prior Expected Multi-utility representation and discuss the necessity of an axiomatization of the Multi-prior Expected Multi-utility model when the prize space is not finite. In particular, we explain how the two applications we develop in this paper could be generalized to that model if we had such an axiomatization.

Games and Economic Behavior, 2014

This paper axiomatizes models of second-order ambiguous beliefs in the original domain of prefere... more This paper axiomatizes models of second-order ambiguous beliefs in the original domain of preferences of Anscombe and Aumann (1963) by weakening the (first-stage) independence postulate. The models we propose include the Second-Order Subjective Expected Utility (SOSEU) of Seo (2009) as a particular case. We characterize the intersection of our models of second-order ambiguity with the canonical models of (first-order) ambiguity

Theory and Decision, 2013

The goal of this paper is to develop, axiomatically, a reference-dependent choice model that acco... more The goal of this paper is to develop, axiomatically, a reference-dependent choice model that accounts,fully for the famous,attraction e¤ect. Our model,is formulated,under the premises of revealed preference theory, and hence it does not take the “reference” for an agent as exogenously given in the description of a choice problem. Instead, by suitably relaxing the WARP, we derive the existence of reference alternatives, and the choice behavior,conditioned,on those alternatives. We consider choice under,certainty and risk separately, and obtain fairly tractable models in each of these cases. As a gen- uine economic application, we reexamine the standard model of monopolistic (vertical) product,di¤erentiation where,a fraction of the demand,side of the market,is subject to the attraction e¤ect. JEL Classi…cation: D11, D81. Keywords: Revealed Preferences, Incomplete Preferences, Attraction E¤ect, Reference- Dependence, Endogeneous Reference Formation, Product Di¤erentiation. Various comm...

Mathematics of Operations Research, 2013

Journal of Economic Theory, 2011