Evidence Theory: A Mathematical Framework for Unpredictable Hypotheses

Guido Fioretti

Experimental from University Library of Munich, Germany

Abstract: Shafer's evidence theory is a branch of the mathematics of uncertain reasoning that allows for novel possibilities to be conceived by a decision-maker. Many of its findings exhibit striking similarities with an alternative decision theory purported by Shackle in the 1950s, before expected utility maximization monopolized the scene. Evidence theory does not attempt to formalize the emergence of novelties, but it is a suitable framework for reconstructing the formation of beliefs when novelties appear. An application to decision-making in the biotech and pharmaceutical industry illustrates the potentialities of evidence theory, as well as its shortcomings.

Keywords: Shackle; Shafer; Cognition; Innovation; Biotechnology (search for similar items in EconPapers)
JEL-codes: C91 D83 (search for similar items in EconPapers)
Date: 2002-07-19
New Economics Papers: this item is included in nep-cbe and nep-ent
Note: Type of Document - PDF; prepared on PC; to print on A4 sheets;
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Related works:
Journal Article: EVIDENCE THEORY: A MATHEMATICAL FRAMEWORK FOR UNPREDICTABLE HYPOTHESES (2004)
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Persistent link: https://EconPapers.repec.org/RePEc:wpa:wuwpex:0207001

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