A Two-Ball Ellsberg Paradox: An Experiment (with Simon Lazarus) 7 February 2023, 14:00 - 15:00
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We conduct an incentivized experiment on a nationally representative US sample (N=708) to test whether people prefer to avoid ambiguity even when it means choosing dominated options. In contrast to the literature, we find that 55% of subjects prefer a risky act to an ambiguous act that always provides a larger probability of winning. Our experimental design shows that such a preference is not mainly due to a lack of understanding. We conclude that subjects avoid ambiguity per se rather than avoiding ambiguity because it may yield a worse outcome. Such behavior cannot be reconciled with existing models of ambiguity aversion in a straightforward manner.

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Date: 7 February 2023, 14:00 (Tuesday, 4th week, Hilary 2023)
Venue: Online
Speaker: Mr Brian Jabarian (PSE and Panthéon-Sorbonne University)
Organising department: Department of Economics
Organiser: Bethany McWhinnie (Global Priorities Institute (GPI))
Organiser contact email address: gpi-office@philosophy.ox.ac.uk
Host: Rossa O'Keeffe-O'Donovan (University of Oxford)
Part of: Global Priorities Institute (GPI) - Seminar Series
Booking required?: Not required
Audience: Public
Editors: Rossa O'Keeffe-O'Donovan, Sven Herrmann, Christian Panzer, Bethany McWhinnie