One-switch utility functions with annuity payments

This paper derives the functional forms of multiattribute utility functions that lead to a maximum of one-switch change in preferences between any two uncertain and multi-period cash flows as the decision maker’s wealth increases through constant annuity payments. We derive the general and continuou...

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Bibliographic Details
Published in:Applied mathematics and computation 2013-03, Vol.219 (14), p.7699-7710
Main Authors: Abbas, A.E., Chudziak, J.
Format: Article
Language:English
Subjects:
Computation
Functional equations
Invariance
Mathematical analysis
Mathematical models
One-switch
Utilities
Utility theory
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Summary:This paper derives the functional forms of multiattribute utility functions that lead to a maximum of one-switch change in preferences between any two uncertain and multi-period cash flows as the decision maker’s wealth increases through constant annuity payments. We derive the general and continuous non-constant solutions of the corresponding functional equations.
ISSN:0096-3003
1873-5649
DOI:10.1016/j.amc.2013.01.058