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Robustifying the Classical Model of Risk Preferences and Beliefs

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Author Info
Mark Machina (University of California, San Diego)
Abstract

Robustify. To identify the analytical aspects of a model that continue to hold under more genral conditions. This usually requires expressing the model and its results in a particular manner as statements that may be logically equivalent under the assumptions of a given model can differ widely in their robustness to dropping these assumptions. E.g., "By expressing the classical expected utility/subjective probability model in event-theoretic therms, tis asic concepts, tools and results can be locally and globally robustified to general 'event-smooth' preferences over subjectively uncertain acts that do not necessarily exhibit either expected utility risk preferences or probabilistic beliefs."

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Paper provided by Department of Economics, UC San Diego in its series University of California at San Diego, Economics Working Paper Series with number 2002-06.

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Date of creation: 13 Mar 2002
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Handle: RePEc:cdl:ucsdec:2002-06

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Keywords: Risk;

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Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Marciano Siniscalchi, 2003. "A Behavioral Characterization of Plausible Priors," Levine's Bibliography 234936000000000064, UCLA Department of Economics. [Downloadable!]
    Other versions:
  2. Mark J. Machina, 2001. "Almost-Objective Uncertainty," University of California at San Diego, Economics Working Paper Series 2001-12, Department of Economics, UC San Diego. [Downloadable!]
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