The objective of this paper is to analyze the effect the uncertainty about the probabilities has in the decision making process. In particular, I give an answer to the following question: Does the ambiguous nature of an outcome lead an ambiguity averse decision maker to exert more effort than another who does not take this ambiguity into account? In the context of climate change, this question could be assimilated to the one referring to the Precautionary Principle: Should the lack or the incompleteness of information lead environmental policy to be precautionary in the sense of favoring more intense intervention?

Author names: 
Berger, L.
European Centre for Advanced Research in Economics and Statistics (ECARES)
Year: 
2011
Reference: 

Berger, L., & European Centre for Advanced Research in Economics and Statistics (ECARES), S. B. S. of E. and M. (2011). Does Ambiguity Aversion Raise the Optimal Level of Effort? A Two-Period Model. Retrieved from https://dipot.ulb.ac.be/dspace/bitstream/2013/95854/1/2011-021-BERGER_do...

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