In decision theory there are basically two appr hes to the modeling of
individual choice: one is based on an absolute representation of
preferences leading to a ntDnerical expression of preference intensity.
This is utility theory. Another approach is based on binary relations
that encode pairwise preference. While the former has mainly blossomed
in the Anglo-Saxon academic world, the latter is mostly advocated in
continental Europe, including Russia. The advantage of the utility
theory approach is that it integrates uncertainty about the state of
nature, that may affect the consequences of decision. Then, the problems
of choice and ranking from the knowledge of preferences become trivial
once the utility function is known. In the case of the relational
approach, the model does not explicitly accounts for uncertainty, hence
it looks less sophisticated. On the other hand it is more descriptive
than normative in the first stand because it takes the pairwise
preference pattern expressed by the decision-maker as it is and tries to
make the best out of it. Especially the preference relation is not
supposed to have any property. The main problem with the utility theory
approach is the gap between what decision-makers are and can express,
and what the theory would like them to be and to be capable of
expressing. With the relational approach this gap does not exist, but
the main difficulty is now to build up convincing choice rules and
ranking rules that may help the decision process.