Discriminating Between Models of Ambiguity Attitude: A Qualitative Test

Robin Cubitt, Gijs van de Kuilen, Sujoy Mukerji

Research output: Working paperDiscussion paperOther research output

Abstract

The exchange between Epstein (2010) and Klibanoff et al. (2012) identified a behavioral issue that sharply distinguishes between two classes of models of ambiguity sensitivity, exemplified by the 훼- MEU model and the smooth ambiguity model, respectively. The issue in question is whether a subject’s preference for a randomized act (compared to its pure constituents) is influenced by a desire to hedge independently resolving ambiguities. Building on this insight, we implement an experiment whose design provides a qualitative test that discriminates between these importantly distinct classes
of models. Among subjects identified as ambiguity sensitive, we find greater support for the class exemplified by the smooth ambiguity model; the relative support is stronger among subjects identified as ambiguity averse.
Original languageEnglish
Place of PublicationOxford
PublisherUniversity of Oxford
Number of pages42
Publication statusPublished - Jan 2014

Publication series

NameDiscussion Paper Series
Volume692

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Cubitt, R., van de Kuilen, G., & Mukerji, S. (2014). Discriminating Between Models of Ambiguity Attitude: A Qualitative Test. (Discussion Paper Series; Vol. 692). Oxford: University of Oxford.
Cubitt, Robin ; van de Kuilen, Gijs ; Mukerji, Sujoy. / Discriminating Between Models of Ambiguity Attitude : A Qualitative Test. Oxford : University of Oxford, 2014. (Discussion Paper Series).
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Cubitt, R, van de Kuilen, G & Mukerji, S 2014 'Discriminating Between Models of Ambiguity Attitude: A Qualitative Test' Discussion Paper Series, vol. 692, University of Oxford, Oxford.

Discriminating Between Models of Ambiguity Attitude : A Qualitative Test. / Cubitt, Robin; van de Kuilen, Gijs; Mukerji, Sujoy.

Oxford : University of Oxford, 2014. (Discussion Paper Series; Vol. 692).

Research output: Working paperDiscussion paperOther research output

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Cubitt R, van de Kuilen G, Mukerji S. Discriminating Between Models of Ambiguity Attitude: A Qualitative Test. Oxford: University of Oxford. 2014 Jan. (Discussion Paper Series).