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Book synopsis

Lara Buchak sets out an original account of the principles that govern rational decision-making in the face of risk. A distinctive feature of these decisions is that individuals are forced to consider how their choices will turn out under various circumstances, and decide how to trade off the possibility that a choice will turn out well against the possibility that it will turn out poorly. The orthodox view is that there is only one acceptable way to do this: rational individuals must maximize expected utility. Buchak's contention, however, is that the orthodox theory (expected utility theory) dictates an overly narrow way in which considerations about risk can play a role in an individual's choices. Combining research from economics and philosophy, she argues for an alternative, more permissive, theory of decision-making: one that allows individuals to pay special attention to the worst-case or best-case scenario (among other 'global features' of gambles). This theory, risk-weighted expected utility theory, better captures the preferences of actual decision-makers. Furthermore, it isolates the distinct roles that beliefs, desires, and risk-attitudes play in decision-making. Finally, contra the orthodox view, Buchak argues that decision-makers whose preferences can be captured by risk-weighted expected utility theory are rational. Thus, Risk and Rationality is in many ways a vindication of the ordinary decision-maker-particularly his or her attitude towards risk-from the point of view of even ideal rationality.

Book details

Book category Books in English Reference, information & interdisciplinary subjects Research & information: general Decision theory: general

• Full title: Risk and Rationality
• Author: Lara Buchak
• Language: English
• Binding: Hardback
• Number of pages: 274
• EAN: 9780199672165
• ISBN: 0199672164
• ID: 02536810
• Publisher: Oxford University Press
• Weight: 538 g
• Dimensions: 166 × 240 × 23 mm
• Date of publishing: 07. November 2013

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