A trichotomy of attitudes for decision-making under complete ignorance
We study decision criteria under complete ignorance, that is, when there is no available information regarding plausible probability distributions over the possible outcomes. We characterize the set of criteria satisfying quasi-transitivity, Savage's independence, duplication, a strong version of dominance and scale invariance. Only three criteria satisfy these requirements. These criteria are the well-known protective criterion, its dual criterion which we call hazardous, and a neutral criterion which is the composition of both (a decision is strictly preferred according to this criterion to another one if both the protective and the hazardous criteria strictly prefer the former).
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.:
- Barbara, Salvador & Jackson, Matthew, 1988. "Maximin, leximin, and the protective criterion: Characterizations and comparisons," Journal of Economic Theory, Elsevier, vol. 46(1), pages 34-44, October.
- David Schmeidler, 1989.
"Subjective Probability and Expected Utility without Additivity,"
Levine's Working Paper Archive
7662, David K. Levine.
- Schmeidler, David, 1989. "Subjective Probability and Expected Utility without Additivity," Econometrica, Econometric Society, vol. 57(3), pages 571-87, May.
- Bossert, W., 1996.
"Uncertainty Aversion in Nonprobabilistic Decision Models,"
9609, University of Waterloo, Department of Economics.
- Bossert, Walter, 1997. "Uncertainty aversion in nonprobabilistic decision models," Mathematical Social Sciences, Elsevier, vol. 34(3), pages 191-203, October.
- Gilboa, Itzhak & Schmeidler, David, 1989. "Maxmin expected utility with non-unique prior," Journal of Mathematical Economics, Elsevier, vol. 18(2), pages 141-153, April.
- Toulet, Claude, 1986. "Complete ignorance and independence axiom: Optimism, pessimism, indecisiveness," Mathematical Social Sciences, Elsevier, vol. 11(1), pages 33-51, February.
- Ghirardato, Paolo & Maccheroni, Fabio & Marinacci, Massimo, 2004. "Differentiating ambiguity and ambiguity attitude," Journal of Economic Theory, Elsevier, vol. 118(2), pages 133-173, October.
- Cohen, Michele & Jaffray, Jean-Yves, 1980. "Rational Behavior under Complete Ignorance," Econometrica, Econometric Society, vol. 48(5), pages 1281-99, July.
When requesting a correction, please mention this item's handle: RePEc:eee:matsoc:v:59:y:2010:i:1:p:15-25. See general information about how to correct material in RePEc.
If references are entirely missing, you can add them using this form.