ambiguity aversion. This characterization extends to regret-based models as well. As an application of our general result, we … characterize dynamically consistent updating for two important models of ambiguity averse preferences: the ambiguity averse smooth … ambiguity preferences (Klibanoþ, Marinacci and Mukerji [Econometrica 73 2005, pp. 1849-1892]) and the variational preferences …

This paper proposes a model of decision under ambiguity deemed vector expected utility, or VEU. In this model, an … that reflects the individual's perception of ambiguity and her attitudes toward it. The adjustment is itself a function of … the act's exposure to distinct sources of ambiguity, as well as its variability. The key elements of the VEU model are a …

the α-MEU model of choice under ambiguity (Hurwicz, 1951) can overcome several challenges faced by the baseline model …

We consider a general framework of optimal mechanism design under adverse selection and ambiguity about the type …

Raiffa (1961) criticizes ambiguity-averse preferences by claiming that hedging is possible with randomization of …

important contexts. Under ambiguity aversion, an ex-ante mixture could provide only ex-ante hedging but not ex-post hedging … particular, two representations are characterized for each context. One representation for ambiguity aversion is an extension of …

We propose a class of multiple-prior representations of preferences under ambiguity where the belief the decision … Optimism. The model does not restrict the sign of the DM's ambiguity attitude, and we show that it provides a unified framework … through which to characterize different degrees of ambiguity aversion, as well as to represent context-dependent negative and …

We study the impact of ambiguity on two alternative institutions of nancial intermediationin an economy where consumers … liquidity needs. With increasing ambiguity this preference will be reversed:the asset market is preferred, since it avoids …

Banking regulators often practice forbearance and ambiguity in insolvency resolutions. The paperexamines the effects of … regulatory forbearance and ambiguity in a context of allocational efficiency.Bailouts, liquidations and their stochastic policy …