Skip to Main Content
Handbook of the Economics of Risk and Uncertainty
book

Handbook of the Economics of Risk and Uncertainty

by Mark Machina, W. Kip Viscusi
November 2013
Beginner content levelBeginner
896 pages
35h 10m
English
North Holland
Content preview from Handbook of the Economics of Risk and Uncertainty
Edi Karni
24
maker’s posterior beliefs, are obtained by updating the probabilities representing his/
her prior beliefs using Bayes’ rule. The critical aspect of Bayesian decision theory is,
therefore, the existence and uniqueness of subjective probabilities, prior and posterior,
representing the decision maker’s prior and posterior beliefs that abide by Bayes’ rule.
As was argued in Section 1.3.5, in decision theories invoking Savage’s analytical
framework, the unique representation of beliefs is predicated on a convention, that
constant acts are constant utility acts, that is not implied by the preference structures.
Consequently, these models ...
Become an O’Reilly member and get unlimited access to this title plus top books and audiobooks from O’Reilly and nearly 200 top publishers, thousands of courses curated by job role, 150+ live events each month,
and much more.
Start your free trial

You might also like

Handbook of the Economics of Finance

Handbook of the Economics of Finance

George M. Constantinides, Milton Harris, Rene M. Stulz
Quantitative Financial Risk Management: Theory and Practice

Quantitative Financial Risk Management: Theory and Practice

Constantin Zopounidis, Emilios Galariotis
Mathematical Methods for Finance: Tools for Asset and Risk Management

Mathematical Methods for Finance: Tools for Asset and Risk Management

Sergio M. Focardi, CFA Frank J. Fabozzi, Turan G. Bali

Publisher Resources

ISBN: 9780444536853