All pages with keywords: ambiguity-aversion

Ambiguity aversion under maximum-likelihood updating

Ambiguity aversion under maximum-likelihood updating

a research article by Daniel Heyen 20 June, 2017

Maximum-likelihood updating (MLU) is a well-known approach for extending static ambiguity sensitive preferences to dynamic set-ups. This paper develops an example in which MLU induces an ambiguity averse maxmin … read more »


Ambiguity and insurance: capital requirements and premiums

Ambiguity and insurance: capital requirements and premiums

a working paper by Simon Dietz, Oliver Walker 21 November, 2016

Many insurance contracts are contingent on events such as hurricanes, terrorist attacks or political upheavals, whose probabilities are ambiguous. This paper offers a theory to underpin the large body of … read more »


Safe haven assets and investor behaviour under uncertainty

Safe haven assets and investor behaviour under uncertainty

a research article by Tom McDermott 14 February, 2012

Financial crises and contagion have highlighted the need for safe haven assets. However, their existence, role and interactions are not well understood. We analyze the two most prominent yet … read more »


Ambiguity is another reason to mitigate climate change

Ambiguity is another reason to mitigate climate change

a commentary by Simon Dietz, Antony Millner 1 September, 2010

The answers to “How much should people sacrifice today for the benefit of those living several decades from now?” vary widely. This column suggests that people’s distaste for uncertainty – … read more »