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Notes On The Theory Of Choice (Underground Classics in Economics), by David Kreps
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In this book, Professor Kreps presents a first course on the basic models of choice theory that underlie much of economic theory. This course, taught for several years at the Graduate School of Business, Stanford University, gives the student an introduction to the axiomatic method of economic analysis, without placing too heavy a demand on mathematical sophistication.The course begins with the basics of choice and revealed preference theory and then discusses numerical representations of ordinal preference. Models with uncertainty come next: First is von NeumannMorgenstern utility, and then choice under uncertainty with subjective uncertainty, using the formulation of Anscombe and Aumann, and then sketching the development of Savage’s classic theory. Finally, the course delves into a number of special topics, including de Finetti’s theorem, modeling choice on a part of a larger problem, dynamic choice, and the empirical evidence against the classic models.
- Sales Rank: #650623 in Books
- Brand: Brand: Westview Press
- Published on: 1988-05-12
- Original language: English
- Number of items: 1
- Dimensions: 8.50" h x .52" w x 5.50" l, .65 pounds
- Binding: Paperback
- 224 pages
- Used Book in Good Condition
About the Author
David M. Kreps is the Paul E. Holden Professor of Economics in the Graduate School of Business, Stanford University.
Most helpful customer reviews
16 of 17 people found the following review helpful.
Useful, concise, requires some background
By A. Wakefield
I think this book certainly deserves its good reputation as a primer on the variations and developments of utility theory. It must be noted that the book requires a fair amount of mathematical background that students coming to choice theory from non-economic backgrounds might not have. The book may be almost inscrutable if you are not ready to think mathematically about choice an aren't familiar with mathematic-decision speak. To that reader, I would refer you to a book called "Thinking and Deciding" by Jonathan Baron and/or the Psychology of Judgment and Decision Making by Scott Plous. For a reader with a psychology background such as myself, those were much gentler introductions, although the material in this book is worth mastering if you want to do serious work in the field of decision making research.
9 of 10 people found the following review helpful.
Start thinking with a decision-theorist mind
By Gabriel Natividad
The book seems harmless at the beginning with the mathematical proofs of some binary relations, which require a little bit of logic - and very careful writing down, if you have to turn in the problems as homework. But it gets more and more challenging - and pushes you to use some Real Analysis and Probability Theory concepts to really master the issues presented. This is not a reference book, nor a traditional textbook: it is a collection of lectures on economics of decision. The Von Neumann Morgernstern model is developed in all its magnitude, going further than any game theory textbook. You start to feel the 3 axioms and the numerical representation as second nature! But then, the Aumann/Anscombe and Savage models are introduced, as well as the limitations of the perfect VNM model. Everything you've learned seems to fall apart.
The problem sets are mainly excursions, in the very Kreps' style (if you have read his Course on Microeconomic Theory, you know what half a page problem without any equation is). In general, you don't need economics to get a good grip of the content: it is decision theory, not micro theory. Engineers and mathematicians will love it - and some economists will find it too tough!
11 of 13 people found the following review helpful.
a splendid book
By A Customer
I have read this book more than 10 times since I came across it. Every time I read this book, I find something new. This book is based on lecture notes on axiomatic choice theory presented by David Kreps(the author) at the Stanford University. If you want to major in economics, in particular, choice theory, this book will enable you to access this area very easily.
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