Ambiguity and Ambiguity Aversion
نویسنده
چکیده
Consider the following choice problem, known as “Ellsberg’s three-color urn example”, or simply the “Ellsberg Paradox” (Ellsberg [7]). An urn contains 30 red balls, and 60 green and blue balls, in unspecified proportions; subjects are asked to compare (i) a bet on a red draw vs. a bet on a green draw, and (ii) a bet on a red or blue draw vs. a bet on a green or blue draw. If the subject wins a bet, she receives 10 dollars; otherwise, she receives 0. To model this situation as a problem of choice under uncertainty, let the state space be {sr, sg, sb}, in obvious notation, and consider the bets in Table 1.
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