Theory of Decision under Uncertainty

“With his seminal works, Itzhak Gilboa is one of the leading figures in the ‘neoclassical’ decision theory that in the past 20 years has considerably expanded the scope of the classical theory pioneered by de Finetti, Ramsey, Savage, and von Neumann. This book provides a superb and much-needed introduction to this exciting research area.” – Massimo Marinacci, Collegio Carlo Alberto, Italy

“Expected utility theory underlies most of statistics, economics, and finance. But are utility functions and probabilities all that we need to formulate wise decisions? And where do utility functions and probabilities come from? Written by the distinguished creator of new decision theories Itzhak Gilboa, Theory of Decision under Uncertainty is a beautifully written critical account of decision theory that answers these and other important questions. Gilboa’s work opens doors for both theorists and applied workers.” – Thomas Sargent, New York University

“This is a fantastic book. It presents an intelligent, rigorous, and thought-provoking treatment of the theory of choice under uncertainty. The combination of philosophical and mathematical approaches is a treat. Graduate students and professional economists alike have much to learn from this book.” – Daron Acemoglu, Massachusetts Institute of Technology

“At the heart of most economic analysis is a description of how individuals make decisions. There have been fundamental advances in our understanding of decision making in recent years, and this book provides an extremely accessible explanation of the current state of the field. Perhaps more importantly, it lays out the conceptual underpinnings of decision theory: why the various assumptions in modeling decision making are made and how they affect economic predictions.” – Andrew Postlewaite, University of Pennsylvania