Expected Utility without Parsimony

This paper seeks to interpret observable behavior and departures from Savage's model of Subjective Expected Utility (SEU) in terms of knowledge and belief. It is shown that observable behavior displays sensitivity to ambiguity if and only if knowledge and belief disagree. In addition, such an epistemic interpretation of ambiguity leads to dynamically consistent extensions of non-SEU preferences.

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Year of publication:	2014-03
Authors:	Billot, Antoine ; Vergopoulos, Vassili
Institutions:	HAL
Subject:	Ambiguity \| state of world \| knowledge \| dynamic consistency

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Extent:	application/pdf
Series:	Post-Print.
Type of publication:	Book / Working Paper
Notes:	View the original document on HAL open archive server: http://halshs.archives-ouvertes.fr/halshs-01021392
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10011025563