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How much ambiguity aversion?: Finding indifferences between Ellsberg's risky and ambiguous bets

Binmore, Ken; Stewart, Lisa; Voorhoeve, Alex

Description

Experimental results on the Ellsberg paradox typically reveal behavior that is commonly interpreted as ambiguity aversion. The experiments reported in the current paper find the objective probabilities for drawing a red ball that make subjects indifferent between various risky and uncertain Ellsberg bets. They allow us to examine the predictive power of alternative principles of choice under uncertainty, including the objective maximin and Hurwicz criteria, the sure-thing principle, and the...[Show more]

CollectionsANU Research Publications
Date published: 2012
Type: Journal article
URI: http://hdl.handle.net/1885/71717
Source: Journal of Risk and Uncertainty
DOI: 10.1007/s11166-012-9155-3

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