Aggregating Preferences over Lotteries in the Absence of Expected Utility

• Applicant: Professor Dr. Florian Brandl
• Subject Area: Economic Theory ; Mathematics
• Term: from 2018 to 2021
• Project identifier: Deutsche Forschungsgemeinschaft (DFG) - Project number 412109921

Economics abounds with instances that require aggregating the preferences of multiple agents, such as a hiring committee voting on different applicants for a job, a parliament deciding on how to allocate a budget to different projects, or a municipality allocating students to schools based on the preferences of the students. Social choice theory and its subfield matching theory are the economic disciplines that formally study preference aggregation and, in particular, mechanisms for aggregating preferences. For many applications, lotteries, that is, probability distributions, over some set of deterministic alternatives qualify as feasible outcomes. Among other benefits, lotteries can guarantee fairness across agents, for example, when assigning students to schools. Much of the literature on aggregating preferences over lotteries assumes that preferences are based on expected utility, that is, agents assign a utility value to every deterministic alternative and prefer lotteries with higher expected utility. However, decision theory has provided evidence for systematic violations of the expected utility hypothesis and a plethora of alternative preference models. This project aims to study the aggregation of preferences over lotteries that are not based on expected utility. The main goal is to construct aggregation mechanisms that are appealing from a normative viewpoint, that is, mechanisms that satisfy desirable properties such as fairness across agents, consistency across different decisions, or resistance to strategic behavior by agents. The proposed approach grounds on formal reasoning, that is, statements are proved or disproved using mathematical methods.

• DFG Programme: Research Fellowships
• International Connection: USA
• Host: Professor Dr. Fuhito Kojima, Ph.D.