This paper investigates a decision-making process involving both risk and uncertainty. The decision-maker is supposed to split events between "familiar", and "unfamiliar" ones, and she/he is assumed to behave differently with respect to them. In particular, it is showed that the DM overweighs...

This paper investigates a decision making process involving both risk and uncertainty. The decision-maker is imagined to have a taxonomy of events in 'risky', 'catastrophic' and 'very favorable' and that she/he behaves differently with respect to them. A representation theorem, which...