Benchmark theory (BT), introduced by Ralph Wedgwood, departs from decision theories of pure expectation maximization like evidential decision theory (EDT) and causal decision theory (CDT) and instead ranks actions according to the desirability of an outcome they produce in some state of affairs compared to a standard—a benchmark—for that state of affairs. Wedgwood motivates BT through what he terms Gandalf’s principle, that the merits of an action in a given state should be evaluated relative only to the performances of other actions in that state, and not to their performances in other states. Although BT succeeds in selecting intuitively rational actions in a number of cases—including some in which EDT or CDT seem to go wrong—it places constraints on rational decision-making that either lack motivation or are untenable. Specifically, I argue that as it stands BT is committed both to endorsing and rejecting the independence of irrelevant alternatives. Furthermore its requirement that weakly dominated actions be excluded from consideration of rational action lacks motivation and threatens to collide with traditional game theory. In the final section of the paper, I construct a counterexample to BT.
KeywordsBenchmark theory Wedgwood Causal decision theory Newcomb’s problem Evidential decision theory Game theory
I am very grateful to Dorothy Edgington, Corine Besson, Dan Adams, Jonathan Nassim, Chris Sykes and to two anonymous referees for this journal for helpful suggestions and comments on this paper.
- Gibbard, A., & Harper, W. (1978). Counterfactuals and two kinds of expected utility. In C. A. Hooker, J. J. Leach, & E. F. McClennen (Eds.), Foundations and applications of decision theory (pp. 125–162). Dordrecht: Reidel.Google Scholar
- Jeffrey, R. (1983). The logic of decision (2nd ed.). Chicago: University of Chicago Press.Google Scholar
- Kahneman, D., & Tversky, A. (1986). The behavioural foundations of economic theory. The Journal of Business, 59(4), S251–S278.Google Scholar
- Stalnaker, R. (1972). Letter to David Lewis. In W. Harper, R. Stalnaker, & G. Pearce (Eds.), Ifs: Conditionals, belief, decision, chance, and time (pp. 151–152). Dordrecht: Reidel.Google Scholar
- Wedgwood, R. (2011). Gandalf’s solution to the newcomb problem. Synthese. doi: 10.1007/s11229-011-9900-1.