Justifiable preferences |
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Authors: | Ehud Lehrer Roee Teper |
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Institution: | a School of Mathematical Sciences, Tel Aviv University, Tel Aviv 69978, Israel b INSEAD, Bd. de Constance, 77305 Fontainebleau Cedex, France |
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Abstract: | We characterize preferences over acts that can be represented by a utility function and a multiple-prior, such that an act f is preferred to act g if there is a prior under which the expected utility induced by f is higher than that induced by g. These preferences are referred to as justifiable preferences. We further introduce a generalized model of ambiguity that involves a collection of multiple-priors, namely, multiple multiple-priors and incorporate Bewley?s Knightian model in justifiability: f is preferred to g if, according to at least one set of priors, f is unanimously preferred to g. |
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Keywords: | D71 D81 |
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