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Risk, Ambiguity, and the Klibanoff Axioms

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  • Kin Chung Lo

    (Department of Economics, York University)

Abstract

Machina (2007) formulates a number of experiments, and shows that they can be used to test the Choquet expected utility model. We show that one of them can also be used to test the class of maxmin expected utility preferences in Klibanoff (2001). Those preferences are not consistent with Choquet expected utility preferences in Machina's experiment.

Suggested Citation

  • Kin Chung Lo, 2008. "Risk, Ambiguity, and the Klibanoff Axioms," Economics Bulletin, AccessEcon, vol. 4(27), pages 1-5.
    • Handle: RePEc:ebl:ecbull:eb-08d80018
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    References listed on IDEAS

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    1. Schmeidler, David, 1989. "Subjective Probability and Expected Utility without Additivity," Econometrica, Econometric Society, vol. 57(3), pages 571-587, May.
    2. Gilboa, Itzhak & Schmeidler, David, 1989. "Maxmin expected utility with non-unique prior," Journal of Mathematical Economics, Elsevier, vol. 18(2), pages 141-153, April.
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    Keywords

    maxmin expected utility;

    JEL classification:

    • D8 - Microeconomics - - Information, Knowledge, and Uncertainty

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