eprintid: 13439
rev_number: 21
eprint_status: archive
userid: 1
dir: disk0/00/01/34/39
datestamp: 2012-06-21 14:47:02
lastmod: 2016-01-18 07:55:06
status_changed: 2012-08-15 09:06:08
type: workingPaper
metadata_visibility: show
creators_name: Eichberger, Jürgen
creators_name: Oechssler, Jörg
creators_name: Schnedler, Wendelin
title: How do people cope with an ambiguous situation when it becomes even more ambiguous?
ispublished: pub
subjects: ddc-330
divisions: i-181000
keywords: ambiguity aversion , uncertainty , minmax-expected utility
abstract: As illustrated by the famous Ellsberg paradox, many subjects prefer to bet on events with known rather than with unknown probabilities, i.e., they are ambiguity averse. In an experiment, we examine subjects’ choices when there is an additional source of ambiguity, namely, when they do not know how much money they can win. Using a standard independence assumption, we show that ambiguity averse subjects should continue to strictly prefer the urn with known probabilities. In contrast, our results show that many subjects no longer exhibit such a strict preference. This should have important ramifications for modeling ambiguity aversion.
abstract_translated_lang: eng
class_scheme: jel
class_labels: D81, C91
date: 2012
date_type: published
id_scheme: DOI
id_number: 10.11588/heidok.00013439
schriftenreihe_cluster_id: sr-3
schriftenreihe_order: 0528
ppn_swb: 1651523231
own_urn: urn:nbn:de:bsz:16-opus-134394
language: ger
bibsort: EICHBERGERHOWDOPEOPL2012
full_text_status: public
citation:   Eichberger, Jürgen ; Oechssler, Jörg ; Schnedler, Wendelin  (2012) How do people cope with an ambiguous situation when it becomes even more ambiguous?  [Working paper]     
document_url: https://archiv.ub.uni-heidelberg.de/volltextserver/13439/1/Eichberger_Oechssler_Schnedler_dp528.pdf