Rational Individual Choice and Consequentialism
 “Changing Tastes and Coherent Dynamic Choice,” Review of Economic Studies 43 (1976), 159–173; reprinted in K.J. Lancaster (ed.) Consumer Theory (Cheltenham, UK: Edward Elgar, 1999) ch. 23, pp. 367–381.
Abstract: Changes of taste can be exogenous or endogenous. Both kinds can be handled by the general notion of a dynamic choice function defined on a decision tree. A general dynamic choice function is inconsistent in the sense that actual choices are likely to depart from planned choices. Then the agent may be naive or sophisticated. But then he is likely to be “incoherent” — in particular, his choices will not correspond to a preference relation. Under special assumptions, naive and sophisticated choice are coherent if and only if they coincide, which happens when tastes are “essentially consistent”; otherwise, both are incoherent.
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 “Total Discounted Demands and LongPeriod Preferences,” Economic Record 52 (1976), 26–35.
Abstract: Suppose a consumer’s tastes are not changing secularly, but merely fluctuating over short periods. Suppose the consumer predicts his fluctuating tastes. Suppose prices remain constant. Then the consumer’s present discounted demand vector maximizes a fixed long period utility function. But when some taste fluctuations are unforeseen, then in general, a long period average demand vector maximizes a long period utility function only if the short run Engel curves are linear and have constant slopes that are independent of the taste fluctuations.
 “Endogenous Tastes and Stable LongRun Choice,” Journal of Economic Theory 13 (1976), 329–340.
Abstract: Suppose that shortrun preferences depend upon consumption one period earlier. Then there is an acyclic longrun strict preference relation iff, for every finite set, every conservative choice sequence converges. If longrun preferences are acyclic, then a unique longrun choice from a compact set is globally stable. If the longrun choice set includes multiple choices, there is a weaker stability property. Under special assumptions there results are extended to cases when the shortrun consumption set is endogenous, and when more previous periods affect the present
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 “Dynamic Restrictions on Metastatic Choice,” Economica 44 (1977), 337–350.
Abstract: Economists customarily reduce dynamic decision problems to the choice of a single policy, which lasts for all time. This “metastatic” approach ignores the possibilities for changing the original choice. Can metastatic choices always be expanded into consistent dynamic choices when these possibilities are allowed for, and regardless of what the structure of the dynamic decision problem is? For an individual, such an expansion is possible if and only if his choice function corresponds to an ordering. For social choices depending on individuals’ choices, the expansion is always possible if and only if Arrow’s condition of independence of irrelevant alternatives is satisfied.
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 “Consequentialism and the Independence Axiom,” in B.R. Munier (ed.) Risk, Decision and Rationality (Proceedings of the 3rd International Conference on the Foundations and Applications of Utility, Risk and Decision Theories) (Dordrecht: D. Reidel, 1988), pp. 503–516.
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 “Consequentialist Foundations for Expected Utility,” Theory and Decision 25 (1988), 25–78.
Abstract: Behaviour norms are considered for decision trees which allow both objective probabilities and uncertain states of the world with unknown probabilities. Terminal nodes have consequences in a given domain. Behaviour is required to be consistent in subtrees. Consequentialist behaviour, by definition, reveals a consequence choice function independent of the structure of the decision tree. It implies that behaviour reveals a revealed preference ordering satisfying both the independence axiom and a novel form of surething principle. Continuous consequentialist behaviour must be expected utility maximizing. Other familiar assumptions then imply additive utilities, subjective probabilities, and Bayes’ rule.
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 “Orderly Decision Theory: A Comment on Professor Seidenfeld,” Economics and Philosophy 4 (1988), 292–297.
 “Consistent Plans, Consequentialism, and Expected Utility,” Econometrica 57 (1989), 1445–1449.
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 “Consequentialism, Structural Rationality and Game Theory,” in K.J. Arrow, E. Colombatto, M. Perlman, and C. Schmidt (eds.) The Rational Foundations of Economic Behaviour (IEA Conference Volume No. 114) (London: Macmillan, 1996) ch. 2, pp. 25–42.
Abstract: Previous work on consequentialism (especially in Theory and Decision 1988, pp. 25–78) has provided some justification for regarding an agent’s behaviour as “structurally rational” if and only if there are subjective probabilities, and expected utility is maximized. The key axiom is that rational behaviour should be explicable as the choice of good consequences. This and other axioms will be reassessed critically, together with their logical implications. Their applicability to behaviour in nperson games will also be discussed. The paper concludes with some discussion of modelling bounded rationality.
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 “Subjectively Expected StateIndependent Utility on StateDependent Consequence Domains,” in M.J. Machina and B. Munier (eds.) Beliefs, Interactions, and Preferences in Decision Making (Dordrecht: Kluwer Academic, 1999), pp. 7–21.
Abstract: The standard decision theories of Savage and of Anscombe and Aumann both postulate that the domain of consequences is state independent. But this hypothesis makes no sense when, for instance, there is a risk of death or serious injury. The paper considers one possible way of deriving subjective probabilities and utilities in this case also. Moreover, the utilities will be state independent in the sense of giving equal value to any consequence that happens to occur in more than one state dependent consequence domain. The key is to consider decision trees having “hypothetical” probabilities attached to states of nature, and even to allow hypothetical choices of these probabilities.
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Two chapters for the Handbook of Utility Theory, Vol. 1: Principles (edited with Salvador Barberà and Christian Seidl; Kluwer Academic Publishers, 1998) on:
“Objective Expected Utility: A Consequentialist Perspective,” ch. 5, pp. 145–211;
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“Subjective Expected Utility,” ch. 6, pp. 213–271.
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 “Rationality in Economics,” Rivista internazionale di Scienze sociali Anno CV (1997), 247–288. PDF file of preprint
 “Schumpeterian Innovation in Modelling Decisions, Games, and Economic Behaviour,” History of Economic Ideas XV (2007), 179–195.
Abstract: Von Neumann's standard paradigm of a game in extensive form and Kolmogorov's standard model of a stochastic process both rely on constructing a fixed state space large enough to include all possible future eventualities. This allows a typical singleperson decision problem to be represented as a decision tree. Yet not all eventualities can be foreseen. Also, any practical decision model must limit the state space rather severely. In this way the standard paradigm excludes not only Schumpeter's ideas regarding entrepreneurship, innovation and development, but also Shackle's “unexpected events”. This paper proposes an alternative approach using “decision jungles” with an evolving state space.
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 “Subjective Probabilities with State Independent Utilities on State Dependent Consequence Domains,” Stanford University, Institute of Mathematical Studies in the Social Sciences, Economics Technical Report No. 520 (1987).