Many managerial and consumer decision contexts occur in the presence of ambiguity, or uncertainty in probabilities. Despite its prevalence, there is not yet a general theory about the effects of ambiguity on choices. Moreover, ambiguity has been defined in different ways in the literature, but the specific effects of these different conceptualizations have not been studied. In the dissertation, we classify these different types of ambiguity and develop a descriptive model of the different factors which determine choices under two of these definitions. We predict that the relevant variables will be different depending upon whether the ambiguity arises from within the decision maker or from external sources, and we test these predictions in a series of experimental and qualitative studies. When the source of the ambiguity is internal, i.e., generated by the decision maker, we expect to find credit and blame attributions, attachment to or ownership of estimates, and probability shifts playing the major roles in determining subjects' choices. In contrast, when the ambiguity is externally-generated, we predict that accountability, perceptions of control, and risk attitudes are the primary factors. We confirmed these predictions in a set of laboratory studies. Using knowledge, accountability, perceptions of control, decision frame, and type of ambiguity as experimental variables, we find interesting results about what drives choices under ambiguity. In addition, a series of focus group discussions with both students and executives provided more in-depth information about the decision processes under different types of ambiguity and confirmed the predictions of the model.
