Ambiguity and the Bayesian Paradigm

Itzhak Gilboa and Massimo Marinacci

No 379, Working Papers from IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University

Abstract: This is a survey of some of the recent decision-theoretic literature involving beliefs that cannot be quantified by a Bayesian prior. We discuss historical, philosophical, and axiomatic foundations of the Bayesian model, as well as of several alternative models recently proposed. The definition and comparison of ambiguity aversion and the updating of non-Bayesian beliefs are briefly discussed. Finally, several applications are mentioned to illustrate the way that ambiguity (or “Knightian uncertainty”) can change the way we think about economic problems.

Date: 2011
New Economics Papers: this item is included in nep-cba, nep-hpe and nep-upt
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Citations: View citations in EconPapers (51)

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Working Paper: Ambiguity and the Bayesian Paradigm (2011)
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