Non-Expected Utility Models Under Objective Uncertainty
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Quiggin (1991c) presents the general argument in more detail and discusses applica-
tions such as the problem of the competitive firm under price uncertainty, first analyzed
by Sandmo (1971). Applications to insurance include Ryan and Vaithianathan (2003),
Jeleva (2000), Schmidt and Zank (2007), Segal (1986), and Wakker et al. (1997), along
with an independent development of the rank-dependent model by Wang (1997).
Rank-dependent models have been used to generalize the concept of Quality Adjusted
Life Years (QALYs) widely used in health economics (Bleichrodt and Quiggin, 1997;
Bleichr ...
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