The concept of Ambiguity designates those situations where the information available to the decision maker is …-expected utility models hanging on a shaky ground. In particular, it leaves unanswered basic questions such as: (1) Does Ambiguity … Utility (SEU) in the presence of Ambiguity?, and (4) If so, what kind of behavior should emerge in the presence of Ambiguity …

contingent on those states. The creator of an innovation is an entrepreneur. He is represented by a probability measure on the … probabilities on the new states. The agents in the economy are classified with respect to their attitude towards this Ambiguity: the … financiers are (locally) Ambiguity-seeking while the consumers are Ambiguity-averse. An entrepreneur and a financier come …

In this article we study the effect of uncertainty on an entrepreneur who must choose the capacity of his business …