A Test of Dynamic Consistency and Consequentialism in the Presence of Ambiguity
|Speaker:||David Kelsey, University of Exeter|
|Date: ||Wednesday 31 October 2018|
|Location: ||Matrix Lecture Theatre, Building One|
Abstract: We test dynamic consistency and consequentialism, two key principles of dynamic decision making under ambiguity and relate violations of these principles to subjects' ambiguity attitudes. In our experiment, subjects received a signal which made it attractive for ambiguity averse subjects to deviate from their ex-ante contingent plan and violate dynamic consistency. We found that ambiguity averse subjects were indeed more likely to violate dynamic consistency than ambiguity neutral subjects, but not consequentialism.