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Ambiguity Revealed

Author

Listed:
  • Subir Bose
  • Matthew Polisson
  • Ludovic Renou

Abstract

We derive necessary and suffcient conditions for data sets composed of state-contingent prices and consumption to be consistent with two prominent models of decision making under ambiguity: variational preferences and smooth ambiguity. The revealed preference conditions for the maxmin expected utility and subjective expected utility models are characterized as special cases.

Suggested Citation

  • Subir Bose & Matthew Polisson & Ludovic Renou, 2012. "Ambiguity Revealed," Discussion Papers in Economics 12/07, Division of Economics, School of Business, University of Leicester.
    • Handle: RePEc:lec:leecon:12/07
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    References listed on IDEAS

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    Cited by:

    1. Aluma Dembo & Shachar Kariv & Matthew Polisson & John K.-H. Quah, 2021. "Ever Since Allais," Bristol Economics Discussion Papers 21/745, School of Economics, University of Bristol, UK.
    2. Polisson, Matthew & Renou, Ludovic, 2016. "Afriat’s Theorem and Samuelson’s ‘Eternal Darkness’," Journal of Mathematical Economics, Elsevier, vol. 65(C), pages 36-40.
    3. Matthew Polisson & John K.-H. Quah, 2013. "Revealed preference tests under risk and uncertainty," Discussion Papers in Economics 13/24, Division of Economics, School of Business, University of Leicester.
    4. Stefania Minardi & Andrei Savochkin, 2017. "Characterizations of Smooth Ambiguity Based on Continuous and Discrete Data," Mathematics of Operations Research, INFORMS, vol. 42(1), pages 167-178, January.

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    More about this item

    Keywords

    Ambiguity; revealed preference; maxmin; variational preferences; expected utility; smooth; uncertainty;
    All these keywords.

    JEL classification:

    • D1 - Microeconomics - - Household Behavior
    • D8 - Microeconomics - - Information, Knowledge, and Uncertainty

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