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Preference theory is a multidisciplinary (mainly sociological) theory developed by Catherine Hakim. [ 1 ] [ 2 ] It seeks both to explain and predict women's choices regarding investment in productive or reproductive work.
In psychology, economics and philosophy, preference is a technical term usually used in relation to choosing between alternatives. For example, someone prefers A over B if they would rather choose A than B. Preferences are central to decision theory because of this relation to behavior.
A simple example of a preference order over three goods, in which orange is preferred to a banana, but an apple is preferred to an orange. In economics, and in other social sciences, preference refers to an order by which an agent, while in search of an "optimal choice", ranks alternatives based on their respective utility.
When faced with several alternatives, the person will choose the alternative with the highest utility. The utility function is not visible; however, by observing the choices made by the person, we can "reverse-engineer" his utility function. This is the goal of revealed preference theory. [citation needed] In practice, however, people are not ...
Revealed preference theory, pioneered by economist Paul Anthony Samuelson in 1938, [1] [2] is a method of analyzing choices made by individuals, mostly used for comparing the influence of policies [further explanation needed] on consumer behavior. Revealed preference models assume that the preferences of consumers can be revealed by their ...
Keynes proposes two theories of liquidity preference (i.e. the demand for money): the first as a theory of interest in Chapter 13 and the second as a correction in Chapter 15. His arguments offer ample scope for criticism, but his final conclusion is that liquidity preference is a function mainly of income and the interest rate.
Another aspect of Smart's ethical theory is his acceptance of a preference theory of well-being, which contrasts with the hedonism associated with "classical" utilitarians such as Jeremy Bentham. Smart's combination of the preference theory with consequentialism is sometimes called " preference utilitarianism ".
A major rival to the liquidity preference theory of interest is the time preference theory, to which liquidity preference was actually a response. Because liquidity is effectively the ease at which assets can be converted into currency, liquidity can be considered a more complex term for the amount of time committed in order to convert an asset.