, Volume 53, Issue 1, pp 925
First online:
Expected utility theory from the frequentist perspective
 TaiWei HuAffiliated withDepartment of Economics, Penn State University Email author
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We present an axiomatization of expected utility from the frequentist perspective. It starts with a preference relation on the set of infinite sequences with limit relative frequencies. We consider three axioms parallel to the ones for the von Neumann–Morgenstern (vN–M) expected utility theory. Limit relative frequencies correspond to probability values in lotteries in the vN–M theory. This correspondence is used to show that each of our axioms is equivalent to the corresponding vN–M axiom in the sense that the former is an exact translation of the latter. As a result, a representation theorem is established: The preference relation is represented by an average of utilities with weights given by the relative frequencies.
Keywords
Objective probability Expected utility theory Frequentist theory of probability Decision theoryJEL Classification
D80 D81 Title
 Expected utility theory from the frequentist perspective
 Journal

Economic Theory
Volume 53, Issue 1 , pp 925
 Cover Date
 201305
 DOI
 10.1007/s0019900904829
 Print ISSN
 09382259
 Online ISSN
 14320479
 Publisher
 SpringerVerlag
 Additional Links
 Topics
 Keywords

 Objective probability
 Expected utility theory
 Frequentist theory of probability
 Decision theory
 D80
 D81
 Industry Sectors
 Authors

 TaiWei Hu ^{(1)}
 Author Affiliations

 1. Department of Economics, Penn State University, 608 Kern Graduate Building, University Park, PA, 168023306, USA