Speaker: Arkadii Slinko

Affiliation: The University of Auckland

Title: Axioms for ex-post rationality

Date: Monday, 9 Mar 2009

Time: 3:00 pm

Location: Room 401 (small math seminar room)

A Decision Maker (DM) must choose at discrete moments from a finite set of actions that result in random rewards. The environment is complex in that she finds it impossible to describe the states of the world and is thus prevented from application of standard Bayesian methods of expected utility maximisation. The DM can however be ex-post rational. If she knows the utilities of the prizes she may, at each step, maximise the “expected utility” of each action using empirical frequencies of the rewards. We give axioms for such ex-post rational behaviour.

Mathematical apparatus used is that of multisets and multiset rankings developed by the presenter in a paper with Murat Sertel (2002).

We also consider the topic of utility elicitation which requires the apparatus of random walks on a non-standard grid. An interesting open question will be formulated that may be a topic for a research project or an Honours dissertation.

The paper is written jointly with Murali Agastya (UNSW, Australia and NUS, Singapore).

Everyone welcome!