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Probabilistic risk beliefs are key drivers of economic and health decisions, but people are not always certain about their beliefs. We study these "imprecise probabilities", also known as ambiguous beliefs. We show that imprecision is measurable separately from the levels of risk beliefs. People...
Persistent link: https://www.econbiz.de/10014390526
We study the effect of ambiguity on timing decisions. An agent faces a stopping problem with an uncertain stopping …
Persistent link: https://www.econbiz.de/10014364260
I experimentally examine whether feedback about others' choices provides an anchor for decision-making under ambiguity … relative ambiguity attitude (compared to the peer's) significantly matters for shifts in individual attitudes, and that … dynamics considerably differ between gain and loss domains. For gains, learning to be comparably ambiguity averse increases the …
Persistent link: https://www.econbiz.de/10010364762
decisions on risk assessment and risk management under conditions of ambiguity, i.e. where probabilities cannot be assigned to … underpins conventional cost-benet analysis (CBA). The other requires that an ambiguity-averse decision-rule - of which maxmin …
Persistent link: https://www.econbiz.de/10011409139
between the set of relevant measures, shown by KMS [21] to reflect only perceived ambiguity, and the set of measures (which we … perceived ambiguity. Regarding symmetry assumptions, we show that, under relatively mild conditions, a variety of preference … stringent. Only when it is satisfied may the Bewley set be interpreted as reflecting only perceived ambiguity and not also taste …
Persistent link: https://www.econbiz.de/10011694779
This paper analyzes dynamic choice for ambiguity-sensitive decision makers. It demonstrates that unambiguous behavioral … decision models and updating rules, and delivers unambiguous welfare comparisons. As an example, a characterization of prior …-by-prior Bayesian updating and Consistent Planning for arbitrary maxmin-expected utility preferences is presented. The resulting …
Persistent link: https://www.econbiz.de/10011691151
Using a representative online panel from the US, we examine how individuals' macroeconomic expectations causally affect their personal economic prospects and their behavior. To exogenously vary respondents' expectations we provide them with different professional forecasts about the likelihood...
Persistent link: https://www.econbiz.de/10011877783
Using a representative online panel from the US, we examine how individuals' macroeconomic expectations causally affect their personal economic prospects and their behavior. To exogenously vary respondents' expectations, we provide them with different professional forecasts about the likelihood...
Persistent link: https://www.econbiz.de/10011937404
Persistent link: https://www.econbiz.de/10012805375
This paper develops a micro-founded general equilibrium model of the financial system composed of ultimate borrowers, ultimate lenders and financial intermediaries. The model is used to investigate the impact of uncertainty about the likelihood of governmental bailouts on leverage, interest...
Persistent link: https://www.econbiz.de/10011209863