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Utility is how much a certain outcome satisfies an agent’s preferences. Its unit – the util or utilon – is an abstract arbitrary measure that assumes a concrete value only when the agent’s preferences have been determined through a utility function.

The concept of utility stems from economics and game theory, where it measures how much a certain commodity increases welfare. One of the clearest examples is money: the price that a person is willing to pay for something can be considered a measure of the strength of his or her preference for it. Thus, a willingness to pay a high sum for something implies that the person has a strong desire for it, i.e. it has a high utility for him or her.

Although it has been argued that utility is hard to quantify in the case of humans - mainly due to the complexity of the causal roles played by preferences and motivations – utility-based agents are quite common in AI systems. Examples include navigation systems or automated resources allocation models, where the agent has to choose the best action based on its expected utility.

Further Reading & References

  • Mistakes in Choice-Based Welfare Analysis by Botond Köszegi and Matthew Rabin
  • Russell, Stuart J.; Norvig, Peter (2003), Artificial Intelligence: A Modern Approach (2nd ed.), Upper Saddle River, New Jersey: Prentice Hall, ISBN 0-13-790395-2

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