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Reexamination on Updating Choquet Beliefs

Author

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  • Mayumi Horie

    (Institute of Economic Research, Kyoto University)

Abstract

Eichberger, Grant, and Kelsey (2007) characterize the full Bayesian update rule for capacities. This paper shows that a conditional preference relation represented by the Choquet expected utility with respect to the updated capacity through the rule does not satisfy the axiom of Conditional Certainty Equivalence Consistency. A counterexample is provided and it is proved that a relaxation of the axiom maintains their results.

Suggested Citation

  • Mayumi Horie, 2007. "Reexamination on Updating Choquet Beliefs," KIER Working Papers 643, Kyoto University, Institute of Economic Research.
    • Handle: RePEc:kyo:wpaper:643
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    File URL: http://www.kier.kyoto-u.ac.jp/DP/DP643.pdf
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    References listed on IDEAS

    as
    1. Paolo Ghirardato & Massimo Marinacci, 2001. "Risk, Ambiguity, and the Separation of Utility and Beliefs," Mathematics of Operations Research, INFORMS, vol. 26(4), pages 864-890, November.
    2. Eichberger, Jurgen & Grant, Simon & Kelsey, David, 2007. "Updating Choquet beliefs," Journal of Mathematical Economics, Elsevier, vol. 43(7-8), pages 888-899, September.
    3. Cesaltina Pacheco Pires, 2002. "A Rule For Updating Ambiguous Beliefs," Theory and Decision, Springer, vol. 53(2), pages 137-152, September.
    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. Eichberger, Jürgen & Grant, Simon & Lefort, Jean-Philippe, 2008. "Neo-additive capacities and updating," Papers 08-31, Sonderforschungsbreich 504.
    2. Dominiak, Adam & Eichberger, Jürgen & Lefort, Jean-Philippe, 2012. "Agreeable trade with optimism and pessimism," Mathematical Social Sciences, Elsevier, vol. 64(2), pages 119-126.
    3. repec:dau:papers:123456789/7332 is not listed on IDEAS

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    More about this item

    Keywords

    Bayesian update; capacity; conditional preference; Choquet expected utility;
    All these keywords.

    JEL classification:

    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty

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