Confidence as a Source of Deferral

Brian Hill ()
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Brian Hill: IHPST - Institut d'Histoire et de Philosophie des Sciences et des Techniques - UP1 - Université Paris 1 Panthéon-Sorbonne - DEC - Département d'Etudes Cognitives - ENS-PSL - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris Sciences et Lettres - CNRS - Centre National de la Recherche Scientifique

Working Papers from HAL

Abstract: One apparent reason for deferring a decision – abstaining from choosing, leaving the decision open to be taken by someone else, one's later self, or nature – is for lack of sufficient confidence in the relevant beliefs. This paper develops an axiomatic theory of decision in situations where a costly deferral option is available that captures this source of deferral. Drawing on it, a preliminary behavioural comparison with other accounts of deferral, such as those based on information asymmetry, is undertaken, and a simple multi-factor model of deferral – involving both confidence and information considerations – is formulated. The model suggests that incorporating confidence can account for cases of deferral that traditional accounts have trouble explaining.

Keywords: Confidence; multiple priors; deferral; delegation; information acquisition; value of information; incomplete preferences (search for similar items in EconPapers)
Date: 2014-10-11
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Persistent link: https://EconPapers.repec.org/RePEc:hal:wpaper:hal-02018559

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