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Hoping for the best while preparing for the worst in the face of uncertainty: a new type of incomplete preferences

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  • Pierre Bardier

    (PSE - Paris School of Economics - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris Sciences et Lettres - EHESS - École des hautes études en sciences sociales - ENPC - École nationale des ponts et chaussées - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, PJSE - Paris Jourdan Sciences Economiques - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris Sciences et Lettres - EHESS - École des hautes études en sciences sociales - ENPC - École nationale des ponts et chaussées - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement)

  • Bach Dong-Xuan

    (Universität Bielefeld = Bielefeld University)

  • Van-Quy Nguyen

    (NEU - National Economics University [Hanoï, Vietnam], EPEE - Centre d'Etudes des Politiques Economiques - UEVE - Université d'Évry-Val-d'Essonne - Université Paris-Saclay)

Abstract

We propose and axiomatize a new model of incomplete preferences under uncertainty, which we call hope-and-prepare preferences. Act f is considered more desirable than act g when, and only when, both an optimistic evaluation, computed as the welfare level attained in a best-case scenario, and a pessimistic one, computed as the welfare level attained in a worst-case scenario, rank f above g. Our comparison criterion involves multiple priors, as best and worst cases are determined among sets of probability distributions, and is, generically, less conservative than Bewley preferences and twofold multi-prior preferences, the two ambiguity models that are closest to ours.

Suggested Citation

  • Pierre Bardier & Bach Dong-Xuan & Van-Quy Nguyen, 2025. "Hoping for the best while preparing for the worst in the face of uncertainty: a new type of incomplete preferences," PSE Working Papers halshs-04615290, HAL.
    • Handle: RePEc:hal:psewpa:halshs-04615290
    Note: View the original document on HAL open archive server: https://shs.hal.science/halshs-04615290v2
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    References listed on IDEAS

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    Keywords

    Decision theory; Incomplete preference; Multiple-selves; Non-obvious manipulability;
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