Conferences at Department of Economics, University of Toronto, Canadian Economic Theory Conference 2022

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Updating uncertainty-averse preferences

Jian Li*

Last modified: 2022-05-19

Abstract


This paper characterizes axiomatically a simple consequentialist updating rule for a broad class of ambiguity-averse preferences, which nests many well-known families of ambiguity averse preferences. In particular, for the translation invariant subfamily
and the positively scale invariant subfamily, explicit representations of the conditional preferences are fully characterized. These updating rules nest the familiar prior-by-prior updating of maxmin EU as a special case.

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