crazy88 comments on CEV-inspired models - Less Wrong

7 Post author: Stuart_Armstrong 07 December 2011 06:35PM

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Comment author: Larks 07 December 2011 10:31:18PM 6 points [-]

Economists generally regard interpersonal utility comparisons as impossible; hence the focus on Pareto, and then Kalder-Hicks, optimality. See for example this, though any decent economics textbook will cover it.

The problem, of course, is that utility functions are only defined up to an affine transformation.

Comment author: Stuart_Armstrong 08 December 2011 09:36:53AM 0 points [-]

The problem, of course, is that utility functions are only defined up to an affine transformation.

Which is why I normalise them first before adding them up.