Download This PaperExplaining the Ellsberg N-Colour Problem by Way of a Fanning Out Hypothesis
6 Pages Posted: 14 Jul 2015
Date Written: July 14, 2015
Abstract
This paper shows that decision makers who maximize expected utility on a ring of hypercomplex numbers, and who have indifference curves that ‘fan out’ in a well-defined way, act as Ellsberg predicted they would in the context of his n-colour problem.
Keywords: Ellsberg n-colour problem, ambiguity aversion, commutative ring
JEL Classification: D80, D81
Suggested Citation: Suggested Citation
Sharpe, Keiran, Explaining the Ellsberg N-Colour Problem by Way of a Fanning Out Hypothesis (July 14, 2015). Available at SSRN: https://ssrn.com/abstract=2630445 or http://dx.doi.org/10.2139/ssrn.2630445
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