Uncertainty Aversion and Separated Effects in Decision Making Under Uncertainty

摘要: A new model is proposed for preferences between acts in the states formulation of decision making under uncertainty. It designed to accommodate violations transitivity, preference reversals, and independence axioms first discussed by Allais Ellsberg. The based on Fishburn’s skew-symmetric bilinear representation lotteries two types state parameters. One these mimics traditional subjective probabilities states; other addresses phenomenon uncertainty aversion attitudes toward ambiguity Special cases are closely related models recently Loomes Sugden Schmeidler.