What do uncertainty-averse decision-makers believe?

DOI10.1007/S001990100187MaRDI QIDQ1865202zbMATH OpenOpenAlexFDO

Authors Matthew J. Ryan

Publication date 25 March 2003

Published in Economic Theory (Search for Journal in Brave)

Full work available at URL https://doi.org/10.1007/s001990100187

zbMATH Keywords

biseparable preferencesepistemic foundations of decisionsnormal form games

Mathematics Subject Classification ID

Noncooperative games (91A10) Decision theory (91B06) Utility theory (91B16)

Review text

The empirical challenges to the classical subjective expected utility theory cause its permanent reconsideration. The generalization proposed in the present paper is based on the concept of firm belief, having the following advantages: firm beliefs are derived from preferences using epistemic inference, they satisfy standard logical properties, and they are available for all biseparable preferences. The corresponding decision making theory includes the Choquet expected utility theory and maxmin expected utility theory as special cases. On the other hand the proposed theory is less conservative than the original Savage theory. The notion of firm belief is applied to the generalized Nash equilibrium for two player normal form games.

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Cited in

(17)

• Correlated Nash equilibrium
• Equilibrium in beliefs under uncertainty
• Support notions for belief functions
• More likely than unlikely
• Bargaining with subjective mixtures
• Games in context: equilibrium under ambiguity for belief functions
• Strategic uncertainty and equilibrium selection in discontinuous games
• Coherent Dempster-Shafer equilibrium and ambiguous signals
• Optimism and pessimism in games
• Increasing uncertainty: a definition
• "Beliefs about Beliefs" without Probabilities
• Strategic games beyond expected utility
• Dynamic consistency for non-expected utility preferences
• Choquet expected utility and never best choice
• On stochastic independence under ambiguity
• The evolutionary stability of optimism, pessimism, and complete ignorance
• Granny versus game theorist: Ambiguity in experimental games

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