Although expected value theory is the dominant paradigm in decision theory, it has problems, such as those raised by bounded and unbounded values, and by causal and evidential approaches. This leaves open the possibility of discovering an alternative decision theory.
One possibility would be to introduce some form of risk aversion into the decision theory, such as that proposed by Lara Buchak.[1] Other alternative theories include rank-dependent expected utility theory, prospect theory, and regret theory, although some of these are more commonly used as descriptive theories than normative models.
Further reading
Briggs, Rachael (2015) Review of Lara Buchak, Risk and Rationality, Notre Dame Philosophical Reviews, March 14.
Buchak, Lara (2013) Risk and Rationality, Oxford: Oxford University Press.
Defends risk aversion as rational.
Buchak, Lara (2022) “Normative Theories of Rational Choice: Rivals to Expected Utility,” Stanford Encyclopedia of Philosophy, Summer 2022 Edition, Edward N. Zalta (ed.), https://plato.stanford.edu/archives/sum2022/entries/rationality-normative-nonutility/.
Tuthill, Jonathan & Darren Frechette (2002) Non-expected utility theories: Weighted expected, rank dependent, and, cumulative prospect theory utility, Proceedings of the NCR-134 Conference on Applied Commodity Price Analysis, Forecasting, and Market Risk Management, St. Louis, MO.
Related entries
altruistic wager | cluelessness | decision theoretic uncertainty | decision theory | expected value | risk aversion | value of information
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Buchak, Lara (2013) Risk and Rationality, Oxford: Oxford University Press.