Ellsberg`s 2-Color Experiment, Bid-Ask Behavior and Ambiguity.
Results in this note relate the observation of an interval of prices at which a DM strictly prefers to hold a zero position on an asset (termed “bid-ask behavior”) to the DM’s perception of the underlying payoff relevant events as ambiguous, as the term is defined in Epstein and Zhang (2001). The co...
| Main Authors: | , |
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| Format: | Working paper |
| Language: | English |
| Published: |
Department of Economics (University of Oxford)
2002
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