A representation theorem for guilt aversion

Martin Jensen, Maria Kozlovskaya

Research output: Contribution to journalArticle

Abstract

Guilt aversion has been shown to play an important role in economic decision-making. In this paper, we take an axiomatic approach to guilt by deducing a utility representation from a list of easily interpretable assumptions on an agent's preferences. It turns out that our logarithmic representation can mitigate the problem of multiplicity of equilibria to which psychological games are prone. We apply the model in three well-known games and show that its predictions are consistent with experimental observations.
Original languageEnglish
Pages (from-to)148-161
JournalJournal of Economic Behavior and Organization
Volume125
DOIs
Publication statusPublished - May 2016

Fingerprint

Representation theorem
Guilt aversion
Economics
Prediction
Multiplicity
Decision making
Psychological
Utility representation
Axiomatic approach
Guilt

Bibliographical note

© 2016, Elsevier. Licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International http://creativecommons.org/licenses/by-nc-nd/4.0/

Keywords

  • Guilt aversion
  • Psychological games
  • Utility representation

Cite this

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A representation theorem for guilt aversion. / Jensen, Martin; Kozlovskaya, Maria.

In: Journal of Economic Behavior and Organization, Vol. 125, 05.2016, p. 148-161.

Research output: Contribution to journalArticle

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