Ambiguity aversion in a delay analogue of the Ellsberg Paradox
Decision makers are often ambiguity averse, preferring options with subjectively known probabilities to options with unknown probabilities. The Ellsberg paradox is the best-known example of this phenomenon. Ambiguity has generally been studied in the domain of risky choice, and many theories of ambi...
| Main Authors: | , |
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| Format: | Article |
| Language: | English |
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Cambridge University Press
2012-07-01
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| Series: | Judgment and Decision Making |
| Subjects: | |
| Online Access: | https://www.cambridge.org/core/product/identifier/S1930297500002734/type/journal_article |
| _version_ | 1797697913346850816 |
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| author | Bethany J. Weber Wah Pheow Tan |
| author_facet | Bethany J. Weber Wah Pheow Tan |
| author_sort | Bethany J. Weber |
| collection | DOAJ |
| description | Decision makers are often ambiguity averse, preferring options with subjectively known probabilities to options with unknown probabilities. The Ellsberg paradox is the best-known example of this phenomenon. Ambiguity has generally been studied in the domain of risky choice, and many theories of ambiguity aversion deal with ambiguity only in this context. However, ambiguity aversion may occur in other contexts. In the present experiment, we examine the effects of ambiguity in intertemporal choice. Subjects imagine they are expecting a package and must choose between two delivery options. Some delivery times are exact. Others are ambiguous, with delivery possible over a range of dates. This problem was structurally identical to the Ellsberg paradox. Subjects showed the same pattern of responses as in the traditional Ellsberg paradox, with each delivery service preferred when it was the unambiguous option. Ambiguity aversion is not specific to risk, but can also occur in other domains. |
| first_indexed | 2024-03-12T03:46:44Z |
| format | Article |
| id | doaj.art-aa9f1f9cf4494870b10e9369c5c3e92c |
| institution | Directory Open Access Journal |
| issn | 1930-2975 |
| language | English |
| last_indexed | 2024-03-12T03:46:44Z |
| publishDate | 2012-07-01 |
| publisher | Cambridge University Press |
| record_format | Article |
| series | Judgment and Decision Making |
| spelling | doaj.art-aa9f1f9cf4494870b10e9369c5c3e92c2023-09-03T12:44:19ZengCambridge University PressJudgment and Decision Making1930-29752012-07-01738338910.1017/S1930297500002734Ambiguity aversion in a delay analogue of the Ellsberg ParadoxBethany J. Weber0Wah Pheow Tan1Department of Psychology, Iowa State University, W112 Lagomarcino Hall, Ames, IA 50011–3180School of Humanities and Social Sciences, Temasek PolytechnicDecision makers are often ambiguity averse, preferring options with subjectively known probabilities to options with unknown probabilities. The Ellsberg paradox is the best-known example of this phenomenon. Ambiguity has generally been studied in the domain of risky choice, and many theories of ambiguity aversion deal with ambiguity only in this context. However, ambiguity aversion may occur in other contexts. In the present experiment, we examine the effects of ambiguity in intertemporal choice. Subjects imagine they are expecting a package and must choose between two delivery options. Some delivery times are exact. Others are ambiguous, with delivery possible over a range of dates. This problem was structurally identical to the Ellsberg paradox. Subjects showed the same pattern of responses as in the traditional Ellsberg paradox, with each delivery service preferred when it was the unambiguous option. Ambiguity aversion is not specific to risk, but can also occur in other domains.https://www.cambridge.org/core/product/identifier/S1930297500002734/type/journal_articleEllsberg paradoxdecision makingambiguityriskdelaychoice |
| spellingShingle | Bethany J. Weber Wah Pheow Tan Ambiguity aversion in a delay analogue of the Ellsberg Paradox Judgment and Decision Making Ellsberg paradox decision making ambiguity risk delay choice |
| title | Ambiguity aversion in a delay analogue of the Ellsberg Paradox |
| title_full | Ambiguity aversion in a delay analogue of the Ellsberg Paradox |
| title_fullStr | Ambiguity aversion in a delay analogue of the Ellsberg Paradox |
| title_full_unstemmed | Ambiguity aversion in a delay analogue of the Ellsberg Paradox |
| title_short | Ambiguity aversion in a delay analogue of the Ellsberg Paradox |
| title_sort | ambiguity aversion in a delay analogue of the ellsberg paradox |
| topic | Ellsberg paradox decision making ambiguity risk delay choice |
| url | https://www.cambridge.org/core/product/identifier/S1930297500002734/type/journal_article |
| work_keys_str_mv | AT bethanyjweber ambiguityaversioninadelayanalogueoftheellsbergparadox AT wahpheowtan ambiguityaversioninadelayanalogueoftheellsbergparadox |