The nonconcavity of money-metric utility: A new formulation and proof

C-Tier
Journal: Economics Letters
Year: 2017
Volume: 154
Issue: C
Pages: 10-12

Authors (2)

Score contribution per author:

0.503 = (α=2.01 / 2 authors) × 0.5x C-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

We offer a new, succinct proof of the fact that the money metric utility is concave for any preference relation representable by a concave function if and only if the indirect utility is affine in wealth. Our proof exploits the existence of a least concave representation established in Debreu (1976), and brings into salience the observation that the money-metric utility to be itself a least-concave representation of the preferences if it is concave. This observation is apparently new.

Technical Details

RePEc Handle
repec:eee:ecolet:v:154:y:2017:i:c:p:10-12
Journal Field
General
Author Count
2
Added to Database
2026-01-29