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On the utility representation of asymmetric single-peaked preferences

By Francisco Martínez-Mora and M. Socorro Puy

Abstract

We introduce two natural types of asymmetric single-peaked preferences, which we name biased-above and biased-below, depending on\ud whether the asymmetry (or preference-bias) favors alternatives above\ud or below the peak. We de ne a rich family of utility functions, the\ud generalized distance-metric utility functions, that can represent preferences biased-above or biased-below, besides accommodating any degree of asymmetry. We also identify restrictions on di¤erentiable utility representations that guarantee the underlying preferences to be\ud biased-above or below, and allow to compare degrees of asymmetry.\ud Finally, we consider a speci c application agents preferences over\ud government size to illustrate the role of factors such as risk aversion\ud and tax distortions in shaping asymmetric preferences

Topics: Single-peaked preferences, asymmetric preferences, quadratic preferences, risk aversion, prudence
Publisher: Dept. of Economics, University of Leicester
Year: 2011
OAI identifier: oai:lra.le.ac.uk:2381/9264

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