Related papers: A Contextual Risk Model for the Ellsberg Paradox
The non-classicality of single quantum systems can be formalised using the notion of contextuality. But can contextuality be convincingly demonstrated in an experiment, without reference to the quantum formalism? The operational approach to…
The equity risk premium puzzle is that the return on equities has far exceeded the average return on short-term risk-free debt and cannot be explained by conventional representative-agent consumption based equilibrium models. We review a…
Statistics is sometimes described as the science of reasoning under uncertainty. Statistical models provide one view of this uncertainty, but what is frequently neglected is the 'invisible' portion of uncertainty: that assumed not to exist…
We propose a novel symbolic modeling framework for decision-making under risk that merges interpretability with the core insights of Prospect Theory. Our approach replaces opaque utility curves and probability weighting functions with…
Unexpectedness is a central concept in Simplicity Theory, a theory of cognition relating various inferential processes to the computation of Kolmogorov complexities, rather than probabilities. Its predictive power has been confirmed by…
In economic applications, model averaging has found principal use examining the validity of various theories related to observed heterogeneity in outcomes such as growth, development, and trade.Though often easy to articulate, these…
In distributionally robust optimization the probability distribution of the uncertain problem parameters is itself uncertain, and a fictitious adversary, e.g., nature, chooses the worst distribution from within a known ambiguity set. A…
Theoretically as well as experimentally it is investigated how people represent their knowledge in order to make decisions or to share their knowledge with others. Experiment 1 probes into the ways how people 6ather information about the…
Education in statistics, the application of statistics in scientific research, and statistics itself as a scientific discipline are in crisis. Within science, the main cause of the crisis is the insufficiently clarified concept of…
The investigations on higher-order type theories and on the related notion of parametric polymorphism constitute the technical counterpart of the old foundational problem of the circularity (or impredicativity) of second and higher order…
We focus on two particular aspects of model risk: the inability of a chosen model to fit observed market prices at a given point in time (calibration error) and the model risk due to recalibration of model parameters (in contradiction to…
Quantum cognition in decision-making is a recent and rapidely growing field. In this paper we develop an expected utility theory in a context of non-classical (quantum) uncertainty. We replace the classical state space with a Hilbert space…
We present unambiguous experimental evidence for (quantum-like) probabilistic contextuality in psychology. All previous attempts to find contextuality in a psychological experiment were unsuccessful because of the gross violations of…
Quantum paradoxes show that the outcomes of different quantum measurements cannot be described by a single measurement-independent reality. Any theoretical description of a quantum measurement implies the selection of a specific measurement…
Prediction in quantum cosmology requires a specification of the universe's quantum dynamics and its quantum state. We expect only a few general features of the universe to be predicted with probabilities near unity conditioned on the…
Recent work on the logical structure of non-locality has constructed scenarios where observations of multi-partite systems cannot be adequately described by compositions of non-signaling subsystems. In this paper we apply these frameworks…
The modeling of complex systems such as ecological or socio-economic systems can be very challenging. Although various modeling approaches exist, they are generally not compatible and mutually consistent, and empirical data often do not…
We show that under plausible levels of background risk, no theory of choice under risk -- such as expected utility theory, prospect theory, or rank dependent utility -- can simultaneously satisfy the following three economic postulates: (i)…
Contextuality is one way of capturing the non-classicality of quantum theory. The contextual nature of a theory is often witnessed via the violation of non-contextuality inequalities---certain linear inequalities involving probabilities of…
Many researchers have applied classical statistical decision theory to evaluate treatment choices and learn optimal policies. However, because this framework is based solely on realized outcomes under chosen decisions and ignores…