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preference: Definition, Synonyms from Answers.com

This entry contains information applicable to United States law only.

The act of an insolvent debtor who pays one or more creditors the full amount of their claims or a larger amount than they would be entitled to receive on a pro rata distribution.

For example, a debtor owes three creditors five thousand dollars each. All three are equally entitled to payment, but the debtor has only twelve thousand dollars in assets. Instead of paying each creditor four thousand dollars, the debtor pays two creditors in full and pays the third creditor the remaining two thousand dollars.

The common law does not condemn a preference. Some state statutes prescribe that certain transfers are void — of no legal force or binding effect — because of their preferential character. If a state antipreference provision protects any actual creditor of the debtor, the trustee in bankruptcy can take advantage of it.

Bankruptcy law does condemn certain preferences. The bankruptcy trustee can void any transfer of property of the debtor if the trustee can establish the following: [nl]1.

The transfer was "to or for the benefit of a creditor."

2.

The transfer was made for or on account of an "antecedent debt" — that is, a debt owed prior to the time of the transfer.

3.

The debtor was insolvent at the time of the transfer.

4.

The transfer was made within ninety days before the date of the filing of the bankruptcy petition or was made between ninety days and one year before the date of the filing of the petition to an insider who had reasonable cause to believe that the debtor was insolvent at the time of the transfer.

5.

The transfer has the effect of increasing the amount that the transferee would receive in a liquidation proceeding under chapter 7 of the bankruptcy law (11 U.S.C.A. § 701 et seq.).

11 U.S.C.A. § 547.

Other statutory provisions, however, create exceptions; if a transfer comes within an exception, the bankruptcy trustee cannot invalidate the transfer even though the aforementioned five elements exist.

See: insolvency.

A cynical view of the world by Ambrose Bierce


n.

A sentiment, or frame of mind, induced by the erroneous belief that one thing is better than another.

An ancient philosopher, expounding his conviction that life is no better than death, was asked by a disciple why, then, he did not die. "Because," he replied, "death is no better than life."

It is longer.


Preference (also called "taste" or "penchant") is a concept, used in the social sciences, particularly economics. It assumes a real or imagined "choice" between alternatives and the possibility of rank ordering of these alternatives, based on happiness, satisfaction, gratification, enjoyment, utility they provide. More generally, it can be seen as a source of motivation. In cognitive sciences, individual preferences enable choice of objectives/goals.

Also, more consumption of a normal good is generally (but not always) assumed to be preferred to less consumption.

Preference in economics

In microeconomics, preferences of consumers and other entities are modelled with preference relations.

Let S be the set of all "packages" of goods and services (or more generally "possible worlds"). Then ≤ is a preference relation on S if it is a binary relation on S such that a ≤ b if and only if b is at least as preferable as a. It is conventional to say "b is weakly preferred to a", or just "b is preferred to a". If a ≤ b but not b ≤ a, then the consumer strictly prefers b to a, which is written a < b. If a ≤ b and b ≤ a then the consumer is indifferent between a and b.

These assumptions are commonly made:

If ≤ is both transitive and complete, then it is a rational preference relation. In some literature, a transitive and complete relation is called a weak order (or total preorder).

If a consumer has a preference relation that violates transitivity, then an unscrupulous person can milk them as follows. Suppose the consumer has an apple, and prefers apples to oranges, oranges to bananas, and bananas to apples. Then, the consumer would be prepared to pay, say, one cent to trade their apple for a banana, because they prefer bananas to apples. After that, they would pay once cent to trade their banana for an orange, and again the orange for an apple, and so on. (See: Intransitivity. Occurences.)

Completeness is more philosophically questionable. In most applications, S is an infinite set and the consumer is not conscious of all preferences. For example, one does not have to make up one's mind about whether one prefers to go on holiday by plane or by train if one does not have enough money to go on holiday anyway (although it can be nice to dream about what one would do if one would win the lottery). However, preference can be interpreted as a hypothetical choice that could be made rather than a conscious state of mind. In this case, completeness amounts to an assumption that the consumer can always make up their mind whether they are indifferent or prefer one option when presented with any pair of options.

Behavioral economics investigates the circumstances when human behavior is consistent and inconsistent with these assumptions.

The indifference relation ~ is an equivalence relation. Thus we have a quotient set S/~ of equivalence classes of S, which forms a partition of S. Each equivalence class is a set of packages that is equally preferred. If there are only two commodities, the equivalence classes can be graphically represented as indifference curves. Based on the preference relation on S we have a preference relation on S/~. As opposed to the former, the latter is antisymmetric and a total order.

It is usually more convenient to describe a preference relation on S with a utility function u : S \rightarrow \textbf R, such that u(a) ≤ u(b) if and only if a ≤ b. A continuous utility function always exists if ≤ is a continuous rational preference relation on Rn. For any such preference relation, there are many continuous utility functions that represent it. Conversely, every utility function can be used to construct a unique preference relation.

All the above is independent of the prices of the goods and services and independent of the budget of the consumer. These determine the feasible packages (those he or she can afford). In principle the consumer chooses a package within his or her budget such that no other feasible package is preferred over it; the utility is maximized.

Notation

Sometimes symbols like \prec, \succ, \precsim, \succsim are used as a reminder that equivalence is not necessarily equality.

References

  • Kreps, David (1990). A Course in Microeconomic Theory. New Jersey: Princeton University Press. ISBN 0-691-04264-0
  • Mas-Colell, Andreu; Whinston, Michael; & Green, Jerry (1995). Microeconomic Theory. Oxford: Oxford University Press. ISBN 0-19-507340-1

See also

External links

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Dansk (Danish)
n. - forkærlighed, den eller det foretrukne, fortrinsrettighed, begunstigelse

idioms:

  • give preference to    sætte højere end
  • in preference to    fremfor
  • preference shares    præferenceaktier

Nederlands (Dutch)
voorkeur, voorliefde, keuzemogelijkheid, voordeel

Français (French)
n. - préférence

idioms:

  • give preference to    donner la préférence à
  • in preference to    de préférence à
  • preference shares    (GB, Fin) actions privilégiées

Deutsch (German)
n. - Präferenz, Vorliebe

idioms:

  • give preference to    bevorzugen
  • in preference to    lieber als
  • preference shares    Vorzugsaktien

Ελληνική (Greek)
n. - προτίμηση, επιλογή

idioms:

  • give preference to    κρίνω προτιμότερο τον..
  • in preference to    κατά προτίμηση έναντι
  • preference shares    προνομιούχες μετοχές

Italiano (Italian)
preferenza, predilezione, precedenza

idioms:

  • give preference to    fare delle preferenze per, avere una preferenza per, essere parziale verso
  • in preference to    piuttosto che
  • preference shares    azioni privilegiate

Português (Portuguese)
n. - preferência (f), prioridade (f)

idioms:

  • give preference to    dar preferência a
  • in preference to    em preferência a
  • preference shares    ações preferenciais

Русский (Russian)
предпочтение

idioms:

  • give preference to    отдавать предпочтение
  • in preference to    отдать предпочтение (чему-либо) перед
  • preference shares    привилегированные акции

Español (Spanish)
n. - preferencia, prioridad

idioms:

  • give preference to    dar preferencia a
  • in preference to    preferentemente a
  • preference shares    acciones preferidas

Svenska (Swedish)
n. - förkärlek, preferens, företräde

中文（简体） (Chinese (Simplified))
偏爱, 优先选择

idioms:

  • give preference to    优先选择...
  • in preference to    优先于, 比...优先
  • preference shares    优先股

中文（繁體） (Chinese (Traditional))
n. - 偏愛, 優先選擇

idioms:

  • give preference to    優先選擇...
  • in preference to    優先於, 比...優先
  • preference shares    優先股

한국어 (Korean)
n. - 더 좋아함, 좋아하는 물질

idioms:

  • give preference to    ~을 좋아하다
  • in preference to    ~에 우선하여

日本語 (Japanese)
n. - 好み, 選択, 他より好むこと, 好みのもの, 優先, 優先権, ひいき, 特恵

idioms:

  • in preference to    優先して, …よりはむしろ
  • preference shares    優先株

العربيه (Arabic)
‏(الاسم) تفضيل, أولويه, المفضل, خيار, حق الاختيار‏

עברית (Hebrew)
n. - ‮העדפה, חיבה מיוחדת, נטייה, דבר מועדף, מתן עדיפות‬

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