On Risk and Uncertainty, and Objective versus Subjective Probability.

• Autores: Keiran Sharpe
• Localización: Economic record, ISSN 0013-0249, Vol. 94, Nº. 0, 2018, págs. 49-72
• Idioma: inglés
• Texto completo no disponible (Saber más ...)
• Resumen

  • In this paper, we use the algebra R × R to characterise decision‐makers’ representations of risk and uncertainty. We show that risk can be represented by objective probabilities on one part of the algebra, and that uncertainty can be represented by subjective probabilities on the other part. Decision‐makers are shown to maximise a generalised form of rank‐dependent expected utility. Their occasionally anomalous behaviour is discussed. [ABSTRACT FROM AUTHOR]