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The weight of argument and non-additive measures: a note

Marcello Basili () and Carlo Zappia ()

Department of Economic Policy, Finance and Development (DEPFID) University of Siena from Department of Economic Policy, Finance and Development (DEPFID), University of Siena

Abstract: This note argues that a representation of the epistemic state of the individual through a non-additive measure provides a novel account of Keynes’s view of probability theory proposed in his Treatise on Probability. The paper shows, first, that Keynes’s “non-numerical probabilities” can be interpreted in terms of decisional weights and distorsions of the probability priors. Second, that the degree of non-additivity of the probability measure can account for the confidence in the assessment without any reference to a second order probability. And, third, that the criterion for decision making under uncertainty derived in the non-additive literature incorporates a measure of the degree of confidence in the probability assessment. The paper emphasises the Keynesian derivation of Ellsberg’s analysis: the parallel between Keynes and Ellsberg is deemed to be significant since Ellsberg’s insights represent the main starting point of the modern developments of decision theory under uncertainty and ambiguity.

Keywords: uncertainty; probabilities; Keynes. (search for similar items in EconPapers)
JEL-codes: B16 D21 (search for similar items in EconPapers)
Date: 2007-06
New Economics Papers: this item is included in nep-hpe and nep-upt
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2) Track citations by RSS feed

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Persistent link: https://EconPapers.repec.org/RePEc:usi:depfid:003

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