Comparison of Risk Aversity for Two Utility Functions on ℝ2
Faculty of Economics and Business Administration, University of Kitakyushu
4-2-1 Kitagata, Kokuraminami, Kitakyushu 802-8577, Japan
Utility functions on two-dimensional regions are demonstrated for decision makers’ risk averse behavior by weighted quasi-arithmetic means. For two utility functions on two-dimensional regions, a concept is introduced that decision making with one utility is more risk averse than decision making with the other utility. A necessary condition and sufficient conditions for the concept are demonstrated by their utility functions.
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