Econometric Society 57th European Meeting
25th August 2002 - 28th August 2002, Venice, Italy

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CHOICE UNDER UNCERTAINTY WITH THE BEST AND WORST IN MIND: NEO-ADDITIVE CAPACITIES


Category: Economic Theory
Rationality and Choice
Tuesday 27th August 2002, 09:30 - 11:00, Room: 1.1
Session Chair(s): Wulf Gaertner, University of Osnabrueck, GERMANY

Presenter(s): Eichberger, Jürgen

Co-Author(s): none

Keyword(s): CEU, optimism, pessimism, uncertainty

JEL(s): D81, G00

Abstract:

The concept of a non-extreme-outcome- additive capacity (neo-additive capacity) is introduced. Neo-additive capacities model optimistic and pessimistic attitudes towards uncertainty as observed in many experimental studies. Moreover, neo-additive capacities can be applied easily in economic problems, as we demonstrate by examples. This paper provides an axiomatisation of Choquet expected utility with neo-capacities in the Anscombe-Aumann framework.


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Paper Reference Number: 1059

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57th European Meeting
25th August 2002 - 28th August 2002, Venice, Italy

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