AI Article Synopsis
- The study investigates how people feel about uncertainty, focusing on two specific traits: ambiguity prudence and ambiguity temperance, in addition to ambiguity aversion.
- Researchers found that most participants' choices align with all three attitudes toward ambiguity, supporting existing theories in this area.
- These results suggest that understanding these attitudes can influence models related to precautionary behaviors, like decision-making in uncertain situations.
Article Abstract
We report the results from an experiment designed to measure attitudes towards ambiguity beyond ambiguity aversion. In particular, we implement recently-proposed model-free preference conditions of ambiguity prudence and ambiguity temperance. Ambiguity prudence has been shown to play an important role in precautionary behavior and the mere presence of ambiguity averse agents in markets. We observe that the majority of individuals' decisions are consistent with ambiguity aversion, ambiguity prudence and ambiguity temperance. This finding confirms the prediction of many popular (specifications of) ambiguity models and has important implications for models of prevention behavior.
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Source |
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| http://www.ncbi.nlm.nih.gov/pmc/articles/PMC5913386 | PMC |
| http://dx.doi.org/10.1007/s10683-017-9542-3 | DOI Listing |
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