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A Unilateral Accident Model Under Ambiguity

Teitelbaum, Joshua C. - 2007

with a probability distribution. Consequently, they do not allow for Knightian uncertainty, or ambiguity, with respect to … accident risk and cannot accommodate optimism (ambiguity loving) or pessimism (ambiguity aversion). This paper presents a … unilateral accident model under ambiguity. To incorporate ambiguity, I adopt the Choquet expected utility framework and represent …

Persistent link: https://www.econbiz.de/10009466424

Model Uncertainty and Liquidity

Routledge, Bryan R; Zin, Stanley E. - 2009

Extreme market outcomes are often followed by a lack of liquidity and a lack of trade. This market collapse seems particularly acute for markets where traders rely heavily on a specific empirical model such as in derivative markets like the market for mortgage backed securities or credit...

Persistent link: https://www.econbiz.de/10009441008

Price-Based vs. Quantity-Based Environmental Regulation under Knightian Uncertainty: An Info-Gap Robust Satisficing Perspective

Stranlund, John K.; Ben-Haim, Yakov - 2006

Conventional wisdom among environmental economists is that the relative slopes of the marginal social benefit and marginal social cost functions determine whether a price-based or quantity-based environmental regulation leads to higher expected social welfare. We revisit the choice between...

Persistent link: https://www.econbiz.de/10009467771

A Production Theory of Pure Economic Loss

Rhee, Robert J. - 2010

Although the pure economic loss rule has been remarkably durable in the common law, it suffers from a theoretical deficit. The rule has not been properly framed within the broader context of Anglo-American political economy. Any theory must recognize that the rule fundamentally deals with...

Persistent link: https://www.econbiz.de/10009432050

Distortion of Outcome and Probability Information in Risky Decisions

DeKay, Michael L.; Patino-Echeverri, Dalia; Fischbeck, … - 2008

the distortion of outcome and probability information in risky decisions or the effects of ambiguity on information … ambiguity by describing outcomes and probabilities using either point estimates or ranges of values. Results replicated those of … Study 1, with no effects of ambiguity on information distortion. …

Persistent link: https://www.econbiz.de/10009440971

Distortion of Outcome and Probability Information in Risky Decisions

DeKay, Michael L.; Patiño-Echeverri, Dalia; Fischbeck, … - 2005

the distortion of outcome and probability information in risky decisions or the effects of ambiguity on information …, we manipulated ambiguity by describing outcomes and probabilities using either point estimates or ranges of values …. Results replicated those of Study 1, with no effects of ambiguity on information distortion. …

Persistent link: https://www.econbiz.de/10009441297

Characterization of time-consistent sets of measures in finite trees

Bier, Monika - 2010

In this paper we give an alternative characterization for time-consistent sets of measures in a discrete setting. For each measure \mathbb{P} in a time-consistent set \mathcal{P} we get a distinct set of predictable processes which in return decribe the \mathbb{P} uniquely. This implies we get a...

Persistent link: https://www.econbiz.de/10009452573

Optimal Stopping under Ambiguity in Continuous Time

Riedel, Frank - 2010

We develop a theory of optimal stopping problems under ambiguity in continuous time. Using results from (backward … from the agent's ambiguity aversion. We show how to use these general results for search problems and American Options. …

Persistent link: https://www.econbiz.de/10009452622

The Best Choice Problem under Ambiguity

Chudjakow, Tatjana; Riedel, Frank - 2009

We model and solve Best Choice Problems in the multiple prior framework: An ambiguity averse decision maker aims to … choose the best among a fixed number of applicants that appear sequentially in a random order. The decision faces ambiguity … stopping strategy is simple. Ambiguity can lead to substantial differences to the classical threshold rule. …

Persistent link: https://www.econbiz.de/10009452623

Optimal Stopping under Ambiguity

Riedel, Frank - 2007

We consider optimal stopping problems for ambiguity averse decision makers with multiple priors. In general, backward …

Persistent link: https://www.econbiz.de/10009452624