The standard Bayesian model implies that information can never have a negative value. We put this implication to the proof. Our paper provides the first test of the value (positive or negative) of information under uncertainty. We show that the "Bayesian implication" stands in conflict with the...

Extensive field and experimental evidence shows that reference points shape behavior. But, what shapes the reference point? Candidates put forward in the literature range from the status quo, to rational expectations and the narrow focus of dreaming or worrying about a single possible outcome....

We propose and axiomatically characterize a representation of ambiguity sensitive preferences. The distinguishing feature of our axiomatization is that we do not require preferences to be event-wise separable over any domain of acts. Even without any such separability restrictions, we are able...