A Variation on Ellsberg
Ellsberg's experiment involved a gamble with no ambiguity (N) and a gam- ble where the prize that could be won is objectively known, but the winning probability depends on the (ambiguous) urn's composition (P). We extend this by including a gamble where the winning probability is objectively known, but the prize depends on the urn's composition (C), and also gambles where both the probability and the prize depend on the urn's composition, and can either be correlated positively (D) or negatively (M). Among transitive subjects who prefer N to P, 40% prefer D to N, 74% prefer D to P, 97% prefer D to M, and the modal ranking (about 39%) satis es D
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- Cerreia-Vioglio, Simone & Maccheroni, Fabio & Marinacci, Massimo & Montrucchio, Luigi, 2013.
"Ambiguity and robust statistics,"
Journal of Economic Theory,
Elsevier, vol. 148(3), pages 974-1049.
- Casadesus-Masanell, Ramon & Klibanoff, Peter & Ozdenoren, Emre, 2000. "Maxmin expected utility through statewise combinations," Economics Letters, Elsevier, vol. 66(1), pages 49-54, January.
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