Foundations of Utility and Risk Theory with Applications

In this volume we present some o the papers that were delivered at FUR-82 - the First International Con erence on Foundations o Utility and Risk Theory in Oslo, June 1982. The purpose o the con erence was to provide a orum within which scientists could report on interesting applications o modern decision theory and exchange ideas about controversial issues in the oundations o the theory o choice under un- certainty. With that purpose in mind we have selected a mixture of applied and theoretical papers that we hope will appeal to a wide spectrum o readers rom graduate students in social science departments and business schools to people involved in making hardheaded decisions in business and government. In an introductory article Ole Hagen gives an overview o various paradoxes in utility and risk theory and discusses these in the light o scientific methodology. He concludes the article by calling or joint efforts to provide decision makers with warkable theories. Kenneth Arrow takes up the same issue on a broad basis in his paper where he discusses the implications o behavior under uncertainty for policy. In the theoretical papers the reader will ind attempts at de initive Statements of the meaning o old concepts and suggestions for the adoption o new concepts. For instance, Maurice Allais discusses four di ferent interpretations o the axioms o probability and explains the need or an empirical characterization o the concept of chance.