We present a theory of expected utility with state-dependent linear utility functions for monetary returns, that incorporates the possibility of loss-aversion. Our results relate to first order stochastic dominance, mean-preserving spread, increasing-concave linear utility profiles and risk aversion. As an application of the expected utility theory developed here, we analyze the contract that a monopolist would offer in an insurance market that allowed for partial coverage of loss.

翻译：我们提出了一种针对货币收益的状态依赖线性效用函数的期望效用理论，该理论包含了损失厌恶的可能性。我们的研究结果涉及一阶随机占优、均值保持展形、递增凹线性效用曲线以及风险厌恶。作为本文所发展的期望效用理论的应用，我们分析了在允许部分损失覆盖的保险市场中，垄断者将提供的保险合同。