SÉMINAIRE DE RECHERCHE EN ÉCONOMIE - GATE LYON SAINT-ÉTIENNE : Mateus Joffily

Mateus Joffily (GATE LSE), présentera un séminaire intitulé : A Bayesian hierarchical model of Ellsberg-type preferences.

Résumé / abstract  :  We consider a Bayesian hierarchical model of Ellsberg-type preferences based on conditional expected utility. In our model, optimism and pessimism emanate from prior beliefs about unobserved outcomes. This implies that optimism and pessimism can only propagate along the structure of the hierarchical model when the probability of outcomes is unknown (ambiguity) rather than known (risk). We show that the prevailing preferences observed in Ellsberg (1961)’s two-urn experiment and Jabarian and Lazarus (2023)’s two-ball experiment are reproduced by our model when prior beliefs are pessimistic.