We consider an experimental setting where agents receive one stylized piece of information at a time about the value of a lottery. We find that Knightian uncertainty about the prior distribution of true lottery values does not hamper decision making by agents and markets. On a mean squared error...

Given a lack of perfect knowledge about the future, agents need to form expectations about variables affecting their decisions. We present an experiment where subjects sequentially receive signals about the true state of the world and need to form beliefs about which one is true, with payoffs...

Many important regulatory decisions are taken by professionals employing limited and conflicting evidence. We conduct an experiment in a merger regulation setting, identifying the role of different standards of proof, volumes of evidence, cost of error and professional or lay decision making....