The normative decision theory in economics: a philosophy of science perspective. The case of the expected utility theory

• Published in: The journal of economic methodology Vol. 27; no. 1; pp. 36 - 50
• Main Author: Małecka, Magdalena
• Format: Journal Article
• Language: English
• Published: London Routledge 02-01-2020; Taylor & Francis Ltd
• Subjects: Ambiguity; Decision analysis; Decision theory; Economic theory; Economists; Expected utility; expected utility theory; normative decision theory; Philosophers; Philosophy; Philosophy of economics; Philosophy of science; the normative turn in economics; Utility theory; values in science
• ISSN: 1350-178X; 1469-9427
• DOI: 10.1080/1350178X.2019.1640891

This article analyses how normative decision theory is understood by economists. The paradigmatic example of normative decision theory, discussed in the article, is the expected utility theory. It has been suggested that the status of the expected utility theory has been ambiguous since early in its history. The theory has been treated as descriptive, normative, or both. This observation is the starting point for the analysis presented here. The text discusses various ways in which economists and philosophers of economics have conceptualized the normative status of the expected utility theory, and it shows that none is satisfactory from the point of view of philosophy of science.