Revealed preferences under uncertainty: Incomplete preferences and preferences for randomization

Revealed Incomplete Preferences under Uncertainty

In this paper we experimentally document the existence of incomplete preferences in decision making under uncertainty. In a series of incentivized decision tasks subjects have to choose between a risky and an ambiguous prospect. Active choices between prospects can as well be avoided by selecting a fair chance device that eventually assigns one of the two prospects to the decision maker. We obs...

Online Appendix: Preferences for Flexibility and Randomization under Uncertainty

In this online appendix, we present an extension of Theorem 1. We show that an RUA representation can incorporate the variational preferences of Maccheroni, Marinacci, and Rustichini (2006), which are general enough to incorporate other well-known uncertainty-averse preferences, such as the maxmin preferences of Gilboa and Schmeidler (1989), the multiplier preferences of Hansen and Sargent (200...

Delegation in decision making under uncertainty. Are preferences incomplete?

In this paper we experimentally document the existence of an unexplored violation of rationality in decision making under uncertainty. In a series of incentivized decision tasks subjects have to choose between risky and ambiguous prospects or state to be indifferent, where the last option effectively means delegating the choice to a fair chance device. We observe that half of the subjects deleg...

Incomplete Preferences under Uncertainty: Indecisiveness in Beliefs versus Tastes

Decision-making under ordinal preferences and uncertainty

This paper investigates the problem of finding a preference relation on a set of acts from the knowledge of an ordering on events (subsets of states of the world) describing the decision-maker (DM)'s uncertainty and an ordering of consequences of acts, describing the DM's preferences. However, contrary to classical approaches to decision theory, we try to do it without resorting to any numerica...