Maximum Expected Utility
Updated 2026-08-13
INTRODUCTION
English translation pending.
CORE DEFINITION
The criterion prescribes multiplying each outcome's utility by the probability of its occurrence, summing across outcomes for each available action, and choosing the action with the largest total. Expected utility differs from expected money, because the same monetary gain carries different utility to different people, and it is this subjective weighting that the rule actually maximizes. Human decisions depart from it systematically, which is why it functions less as a description of behavior than as a rational benchmark used to calibrate and improve real choices.
SCAFFOLDING EFFECT
Reduce cognitive load
- List actions and outcomes: put every available option beside each of its possible results. - Weight by probability: multiply each outcome's value by exactly how likely it is to occur. - Take the maximum: choose the action that has the largest weighted total.
Anchor fast decisions
Under uncertainty no single outcome can be pursued, so the criterion aggregates over the whole distribution, weighting each result by how often it would occur in the long run. The sum is the action's expected value, and comparing these sums across actions ranks them. The weighting matters because rare large gains or losses are scaled down to their true frequency, which is what prevents a jackpot outcome from dominating the choice.
MINIMUM ACTION
In progress 0/1Practice this model in one real situation:
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Source support: Explicit
- en.wikipedia.orghttps://en.wikipedia.org/wiki/Expected_utility_hypothesisverified
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