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Ambiguity aversion solves the conflict between efficiency and incentive compatibility
De Castro, Luciano I.; Yannelis, Nicholas C. - 2010
The conflict between Pareto optimality and incentive compatibility, that is, the fact that some Pareto optimal (efficient) allocations are not incentive compatible is a fundamental fact in information economics, mechanism design and general equilibrium with asymmetric information. This important...
Persistent link: https://www.econbiz.de/10010282940
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Updating ambiguity averse preferences
Hanany, Eran; Klibanoff, Peter - 2008
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 …
Persistent link: https://www.econbiz.de/10010266275
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Preference for randomization and ambiguity aversion
Saito, Kota - 2011
Raiffa (1961) criticizes ambiguity-averse preferences by claiming that hedging is possible with randomization of …
Persistent link: https://www.econbiz.de/10010282920
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Preference for randomization: Ambiguity aversion and inequality aversion
Saito, Kota - 2010
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 …
Persistent link: https://www.econbiz.de/10010286983
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Boolean representations of preferences under ambiguity
Frick, Mira; Iijima, Ryota; Le Yaouanq, Yves - 2019
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 …
Persistent link: https://www.econbiz.de/10012141879
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Neo-additive capacities and updating
Eichberger, Jürgen; Grant, Simon; Lefort, Jean-Philippe - Alfred-Weber-Institut für Sozial- und … - 2009
This paper shows that, for CEU preferences, the axioms consquentialism, state independenceand conditional certainty equivalent consistency under updating characterise a family of capacities,called Genralised Neo-Additive Capacities (GNAC). This family contains as special casesamong others...
Persistent link: https://www.econbiz.de/10005868377
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Risk Attitudes of Nascent Entrepreneurs: New Evidence from an Experimentally Validated Survey
Caliendo, Marco; Fossen, Frank M.; Kritikos, Alexander S. - 2006
The in°uence of risk aversion on the decision to become self-employed is a much discussed topic in the entrepreneurial literature. Conventional wisdom asserts that being an entrepreneur means making risky decisions in uncertain environments; hence more risk-averse individuals are less likely to...
Persistent link: https://www.econbiz.de/10010297253
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Efficiency wages and negotiated profit-sharing under uncertainty
Göcke, Matthias - 2009
Efficiency wage effects of profit sharing are combined with option values related to stochastic future pofit variations. These option effects occur if the workers' profit share is fixed by long-term contracts. The Pareto-improving optimal level of the sharing ratio is calculated for two...
Persistent link: https://www.econbiz.de/10010301371
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On the design of criminal trials: The benefits of a three-verdict system
Siegel, Ron; Strulovici, Bruno - 2015
Persistent link: https://www.econbiz.de/10011335455
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Belirsizlik Altında Karar Alma: Geleneksel ve Modern Yaklaşımlar
Aksoy, Tolga; Şahin, Işıl - 2009
Iktisat yazınında bireylerin belirsizlik altında karar alma davranışları çok uzun süredir incelenmektedir. Yazında standartlaşmış olan Beklenen Değer Teorisi gerçek yaşamı açıklayamadığı gerekçesiyle yoğun eleştirilere maruz kalmış, insan davranışlarıyla daha...
Persistent link: https://www.econbiz.de/10010333089