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Generalized neo-additive capacities and updating

Eichberger, Jürgen; Grant, Simon; Lefort, Jean-Philippe (2012), Generalized neo-additive capacities and updating, International Journal of Economic Theory, 8, 3, p. 237-257. 10.1111/j.1742-7363.2012.00189.x

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Type
Article accepté pour publication ou publié
Date
2012
Journal name
International Journal of Economic Theory
Volume
8
Number
3
Publisher
Wiley
Pages
237-257
Publication identifier
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Author(s)
Eichberger, Jürgen

Grant, Simon

Lefort, Jean-Philippe
Abstract (EN)
This paper shows that, for CEU preferences, the axioms consquentialism, state independence and conditional certainty equivalent consistency under updating characterise a family of capacities, called Genralised Neo-Additive Capacities (GNAC). This family contains as special cases among others neo-additive capacities as introduced by Chateauneuf, Eichberger, and Grant(2007), Hurwicz capacities, and ε-contaminations. Moreover, we will show that the convex version of a GNAC is the only capacity for which the core of the Full-Bayesian Updates of a capacity, introduced by Jaffray (1992), equals the set of Bayesian updates of the probability distributions in the core of the original capacity.
Subjects / Keywords
Conditional certainty equivalent consistency; neo-additive capacities; Choquet expected utility; Updating; Abiguity
JEL
D81 - Criteria for Decision-Making under Risk and Uncertainty
D82 - Asymmetric and Private Information; Mechanism Design