A non-interactive elicitation method for non-linear multiattribute utility functions: Theory and application to agricultural economics

This work proposes an indirect method to elicit the parameters of a non-linear utility function to be compatible with the observed behaviour of decision makers, rather than with their answers to direct surveys.

Abstract

Practical implementation of Multiattribute Utility Theory is limited, partly for the lack of operative methods to elicit the parameters of the Multiattribute Utility Function, particularly when this function is not linear. As a consequence, most studies are restricted to linear specifications, which are easier to estimate and to interpret. We propose an indirect method to elicit the parameters of a non-linear utility function to be compatible with the observed behaviour of decision makers, rather than with their answers to direct surveys. The idea rests on approaching the parameter estimation problem as a dual of the decision problem by making the observed decisions to be compatible with a rational decision making process.