Probability and Uncertainty in Economic Modeling

Itzhak Gilboa, Andrew Postlewaite and David Schmeidler

Journal of Economic Perspectives, 2008, vol. 22, issue 3, 173-88

Abstract: Economic modeling assumes, for the most part, that agents are Bayesian, that is, that they entertain probabilistic beliefs, objective or subjective, regarding any event in question. We argue that the formation of such beliefs calls for a deeper examination and for explicit modeling. Models of belief formation may enhance our understanding of the probabilistic beliefs when these exist, and may also help us characterize situations in which entertaining such beliefs is neither realistic nor necessarily rational.

JEL-codes: D81 (search for similar items in EconPapers)
Date: 2008
Note: DOI: 10.1257/jep.22.3.173
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Citations: View citations in EconPapers (94)

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Related works:
Journal Article: Probability and Uncertainty in Economic Modeling (2009)
Working Paper: Probability and Uncertainty in Economic Modeling (2008)
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