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The impact of statistical learning on violations of the sure-thing principle


  • Nicky Nicholls

    () (Department of Economics, University of Pretoria)

  • Aylit Romm

    () (School of Economic and Business Sciences, University of the Witwatersrand, Johannesburg, South Africa)

  • Alexander Zimper

    () (Department of Economics, University of Pretoria)


This paper experimentally tests whether violations of Savage's (1954) subjective expected utility theory decrease if the ambiguity of an uncertain decision situation is reduced through statistical learning. Because our data does not show such a decrease, existing models which formalize ambiguity within an Anscombe-Aumann (1963) framework--thereby reducing to expected utility theory in the absence of ambiguity--are violated. In contrast, axiomatic models of prospect theory can accommodate our experimental findings because they allow for violations of von Neumann and Morgenstern's (1947) independence axiom whenever uncertain decision situations transform into risky decision situations for which probabilities are known.

Suggested Citation

  • Nicky Nicholls & Aylit Romm & Alexander Zimper, 2013. "The impact of statistical learning on violations of the sure-thing principle," Working Papers 201364, University of Pretoria, Department of Economics.
  • Handle: RePEc:pre:wpaper:201364

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    References listed on IDEAS

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    Cited by:

    1. repec:spr:joecth:v:64:y:2017:i:3:d:10.1007_s00199-016-1007-y is not listed on IDEAS
    2. Groneck, Max & Ludwig, Alexander & Zimper, Alexander, 2016. "A life-cycle model with ambiguous survival beliefs," Journal of Economic Theory, Elsevier, vol. 162(C), pages 137-180.
    3. Alexander Zimper & Wei Ma, 2017. "Bayesian learning with multiple priors and nonvanishing ambiguity," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 64(3), pages 409-447, October.
    4. Larry G. Epstein & Shaolin Ji, 2017. "Optimal Learning and Ellsberg's Urns," Papers 1708.01890,
    5. Konstantinos Georgalos & Enrica Carbone & Gerardo Infante, 2016. "Individual vs. Group Decision Making: an Experiment on Dynamic Choice under Risk and Ambiguity," Working Papers 138739716, Lancaster University Management School, Economics Department.

    More about this item


    Prospect Theory; Choquet Expected Utility Theory; Multiple Priors Expected Utility Theory; Sure Thing Principle; Independence Axiom;

    JEL classification:

    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty

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