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Disambiguation of Ellsberg equilibria in 2x2 normal form games

Decerf, Benoit; Riedel, Frank - 2016

Harsanyi. We prove an extension of the Purification Theorem for 2x2 normal form games. Our result implies that any Ellsberg …

Persistent link: https://www.econbiz.de/10011582520

Ambiguous act equilibria

Bade, Sophie - 2010

A game-theoretic framework that allows for explicitly randomized strategies is used to study the e ect of ambiguity aversion on equilibrium outcomes. The notions of 'independent strategies' as well as of 'common priors' are amended to render them applicable to games in which players lack...

Persistent link: https://www.econbiz.de/10010270432

Strategic pricing of financial options

Bieta, Volker; Broll, Udo; Milde, Hellmuth; Siebel, Wilfried - 2009

The mainstream model of option pricing is based on an exogenously given process of price movements. The implication of this assumption is that price movements are not affected by actions of market participants. However, if we assume that there are indeed impacts on the price movements it no...

Persistent link: https://www.econbiz.de/10010301361

Uncertain acts in games

Riedel, Frank - 2017

. We also discuss the purification of equilibria in the spirit of Harsanyi. …

Persistent link: https://www.econbiz.de/10011806882

How do people cope with an ambiguous situation when it becomes even more ambiguous?

Eichberger, Jürgen; Oechssler, Jörg; Schnedler, Wendelin - 2012

As illustrated by the famous Ellsberg paradox, many subjects prefer to bet on events with known rather than with unknown probabilities, i.e., they are ambiguity averse. In an experiment, we examine subjects’ choices when there is an additional source of ambiguity, namely, when they do not know...

Persistent link: https://www.econbiz.de/10011422234

Gender differences in risk aversion and ambiguity aversion

Borghans, Lex; Golsteyn, Bart H. H.; Heckman, James Joseph - 2009

This paper demonstrates gender differences in risk aversion and ambiguity aversion. It also contributes to a growing … of cognition. Women are more risk averse than men. Over an initial range, women require no further compensation for the … as men. Psychological variables account for some of the interpersonal variation in risk aversion. They explain none of …

Persistent link: https://www.econbiz.de/10010274253

Uncertainty and sustainability in the management of semi-arid rangelands

Quaas, Martin; Baumgärtner, Stefan; Becker, Christian; … - 2004

-equilibrium ecosystem is driven by stochastic precipitation. A risk averse farmer chooses a grazing management strategy under uncertainty …-term optimal grazing management strategy. We show that a risk-averse farmer chooses a strategy such as to obtain insurance from the … analyze the long-run ecological and economic impact of different strategies. We conclude that the more risk-averse a farmer is …

Persistent link: https://www.econbiz.de/10011422121

Tax Policy with Uncertain Future Costs: Some Simple Models

Ball, Christopher; Creedy, John - 2013

role of uncertainty and risk aversion are examined using several highly simplified models involving a possible future …

Persistent link: https://www.econbiz.de/10012115643

Trade retaliation in a monetary-trade model

Whalley, John; Yu, Jun; Zhang, Shunming - 2009

We explore how outcomes of trade policy retaliation (Nash tariff games) are affected when trade simultaneously takes places geographically across countries and through time via financial intermediation. In such models deficits and surpluses in goods trade are endogenously determined, and...

Persistent link: https://www.econbiz.de/10010264539

Optimal tariffs, retaliation and the welfare loss from tariff wars in the Melitz model

Felbermayr, Gabriel; Jung, Benjamin; Larch, Mario - 2011

This paper characterizes analytically the optimal tariff of a large one-sector economy with monopolistic competition and firm heterogeneity in general equilibrium, thereby extending the small-country results of Demidova and Rodriguez-Clare (JIE, 2009) and the homogeneous firms framework of Gros...

Persistent link: https://www.econbiz.de/10010274758