Optimal Saving by Expected Utility Operators
This paper studies an optimal saving model in which risk is represented by a fuzzy number and the total utility function of the model is defined by an expected utility operator. This model generalizes some existing possibilistic saving models and from them, by a particularization, one can obtain new...
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doaj-f98f56a0b2364fe397ca85198b50d0732020-11-25T03:32:40ZengMDPI AGAxioms2075-16802020-02-01911710.3390/axioms9010017axioms9010017Optimal Saving by Expected Utility OperatorsIrina Georgescu0Jani Kinnunen1Academy of Economic Studies, Department of Economic Cybernetics, Piaţa Romana No 6 R 70167, Oficiul Postal 22, 010552 Bucharest, RomaniaDepartment of Information Systems, Åbo Akademi University, Tuomiokirkkotori 3, 20500 Turku, FinlandThis paper studies an optimal saving model in which risk is represented by a fuzzy number and the total utility function of the model is defined by an expected utility operator. This model generalizes some existing possibilistic saving models and from them, by a particularization, one can obtain new saving models. In the paper, sufficient conditions are set for the presence of potential risk to increase optimal saving levels and an approximation formula for optimal saving is demonstrated. Particular models for a few concrete expected utility operators are analyzed for triangular fuzzy numbers and CRRA-utility functions.https://www.mdpi.com/2075-1680/9/1/17expected utility operatorpossibilistic saving modelsprecautionary saving |
collection |
DOAJ |
language |
English |
format |
Article |
sources |
DOAJ |
author |
Irina Georgescu Jani Kinnunen |
spellingShingle |
Irina Georgescu Jani Kinnunen Optimal Saving by Expected Utility Operators Axioms expected utility operator possibilistic saving models precautionary saving |
author_facet |
Irina Georgescu Jani Kinnunen |
author_sort |
Irina Georgescu |
title |
Optimal Saving by Expected Utility Operators |
title_short |
Optimal Saving by Expected Utility Operators |
title_full |
Optimal Saving by Expected Utility Operators |
title_fullStr |
Optimal Saving by Expected Utility Operators |
title_full_unstemmed |
Optimal Saving by Expected Utility Operators |
title_sort |
optimal saving by expected utility operators |
publisher |
MDPI AG |
series |
Axioms |
issn |
2075-1680 |
publishDate |
2020-02-01 |
description |
This paper studies an optimal saving model in which risk is represented by a fuzzy number and the total utility function of the model is defined by an expected utility operator. This model generalizes some existing possibilistic saving models and from them, by a particularization, one can obtain new saving models. In the paper, sufficient conditions are set for the presence of potential risk to increase optimal saving levels and an approximation formula for optimal saving is demonstrated. Particular models for a few concrete expected utility operators are analyzed for triangular fuzzy numbers and CRRA-utility functions. |
topic |
expected utility operator possibilistic saving models precautionary saving |
url |
https://www.mdpi.com/2075-1680/9/1/17 |
work_keys_str_mv |
AT irinageorgescu optimalsavingbyexpectedutilityoperators AT janikinnunen optimalsavingbyexpectedutilityoperators |
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