New framework reveals how social preferences can coexist with expected utility
The article explores how social preferences and expected utility can work together in decision-making. The researchers found that social preferences can align with expected utility if a person's aversion to randomness balances out their social preference for randomness. When a person's preferences follow expected utility rules in both games and decision-making, their range of social preferences becomes limited. The study confirms that inequality aversion and expected utility are not always compatible.