Convex preferences: Difference between revisions

Revision as of 17:21, 23 October 2019

Revision as of 17:25, 23 October 2019

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:<math>\theta y + (1-\theta) x \succeq x </math>.

That is, if a bundle ''y'' is preferred over a bundle ''x'', then any mix of ''y'' with ''x'' is still preferred over ''x''.<ref name=Board>[{{cite web |url=http://www.econ.ucla.edu/sboard/teaching/econ11_09/econ11_09_lecture2.pdf |first=Simon |last=Board. "|title=Preferences and Utility] |date=October 6, 2009 |work=Econ 11. Microeconomic Theory. Autumn 2009 |publisher=University of California, Los Angeles }}</ref>

A preference relation is called '''strictly convex''' if for any

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:<math>\theta y + (1-\theta) x \succ y </math>.

That is, for any two bundles that are viewed as being equivalent, a weighted average of the two bundles is better than each of these bundles.<ref name=Sanders>[{{cite web |url=http://njsanders.people.wm.edu/100A/Prefs_and_Utility_Examples.pdf |archivedate=March 20, 2013 |archiveurl=https://web.archive.org/web/20130320003154/http://njsanders.people.wm.edu/100A/Prefs_and_Utility_Examples.pdf |first=Nicholas J. |last=Sanders, "|title=Preference and Utility - Basic Review and Examples"]. |work=College of William & Mary }}</ref>

== Examples ==