On the Representation of Beliefs by Probabilities

This paper explores two axiomatic structures of subjective expected utility assuming a finite state-space and state-dependent, connected, topological outcome-spaces. Building on the work of Karni and Schmeidler (1981) the analytical framework includes, in addition to the preference relation on acts, introspective preferences on hypothetical lotteries that are linked to the preference relation on acts by consistency axioms. The two models accommodate state-dependent preferences and yield subjective probabilities that correctly represent the decision-maker's beliefs. State-independent preferences are a special case.     

Gambling: The shaping of an opinion

Examining historical and contemporary writings, the authors show that many of the negative arguments about gambling spring from selfish interests in the business and political sectors. The stigma associated with gambling turns out to be a method of preventing competition from gambling, and leads to misguided social policies.The authors are, respectively, associate professor of economics at the Business School of the University of Montreal (HEC), and professor of economics in the department of economics of the University of Montreal. The paper draws on our recently published bookGambling and Speculation (Cambridge University Press, 1990), as well as on events that took place since we finished writing it. We thank Loto-Québec for its financial support.     

Technological knowledge,curriculum and occupational role potential*

This paper examines technological curricula in terms of their potential to be realized in occupational roles. The more the curriculum is oriented towards roles (as opposed to skills or pure knowledge), the greater the probability that it will be articulated in the labour market and the greater its efficacy and legitimacy. The concept of role has been analytically divided into six components: value commitment, normative, communicative, interactive, role intelligence and proficiency components. Theoretically, the more components are present in a given curriculum, the higher the probability that a given occupational role will be effectively articulated. However, their presence is a necessary but insufficient condition for effective role performance; their integration is of equal, if not greater importance, and the latter is meaningful only when the social context of the articulation is taken into account. It was found that the role components do not appear in a balanced manner in technological curricula investigated in Israel, and some hardly receive any attention. Those that are present are weakly linked to actual economic contexts. Thus, it appears that students in technological education, are socialized to minimal role articulation; ie, they are more likely to implement decontextualized tasks than to assume integral occupational roles.     

Data bases for large energy-economic models

The collection, collation and transformation of data into the form required by a large energy-economic model constitutes a significant part of the overall modelling activity. The correct basis for setting up a model data base rests on the separation of the model specification into the four areas of external data transformation, internal data representation, internal data transformation and the mathematical relationships. From this specification, the model may be generated. The internal data base is comprised of a series of tables, covering intersectoral transactions, capital stock transactions, energy sector operating characteristics, consumption patterns and other data. These tables may be compiled direct from source material, or via some research requiring prior data processing. In both cases the process should be fully documented, so that data accuracy is ensured and the data may be updated reliably when new material becomes available. It is recommended that a data coordinating function be established within the modelling group, in order to plan and control data-related activities.     

An informationally parsimonious impartial observer theorem

In Harsanyi's impartial observer theorem, an impartial observer determines a social ordering of the lotteries on the set of social alternatives based on a sympathetic but impartial concern for all individuals in society. This ordering is derived from a more primitive ordering on the set of all extended lotteries. An extended lottery is a lottery which determines both the observer's personal identity and the social alternative. We establish a version of Harsanyi's theorem in which the observer is only required to have preferences on the extended lotteries in which there is an equal chance of being any person in society. Received: 19 June 1996 / Accepted: 30 December 1996     

Teachers' and School Children's Stereotypic Perception of the Child of Divorce: 20 Years Later

ABSTRACT

This is a replica of a study carried out in 1988. Its main objective is to reexamine after 20 years how teachers' and 8th-grade students' evaluations of a child's academic, social, and emotional functioning are affected by the knowledge that the child's parents are divorced. One hundred and twenty junior high school students and 115 female teachers watched a specially produced film of a child engaged in various activities. The child's gender and family structure were experimentally manipulated. The main results show that whereas in the earlier study both teachers and the students rated the child of divorce more negatively than the child of an intact family, in this study this was true only for the teachers. These and other results are discussed in the context of cultural attitudes, the more extensive contact teachers have with children of divorce, and the risk that they and their students become trapped in the Pygmalion cycle.     

Ambiguity attitudes and social interactions: An experimental investigation

This paper reports the results of experiments testing prevalence of non-neutral ambiguity attitudes and how these attitudes change as a result of interpersonal interactions. To address the first question we conducted experiments involving individual choice between betting on ambiguous and unambiguous events of the subject’s choice. We found that a large majority of subjects display ambiguity neutral attitudes, many others display ambiguity incoherent attitudes, and few subjects display either ambiguity-averse attitudes or ambiguity-seeking attitudes. To address the second question we designed a new experiment with a built-in incentive to persuade. We found that interpersonal interactions without incentives to persuade have no effect on behavior. However, when incentives were introduced, the ambiguity neutral subjects were better able to persuade ambiguity seeking and ambiguity incoherent subjects to adopt ambiguity neutral choice behavior and, to a lesser extent, also ambiguity averse subjects.     

Probabilities and beliefs

Choice-theoretic definitions of subjective probabilities originated with the work of Ramsey and de Finetti and attained their definitive form in the work of Savage. These probabilities are intended to provide a numerical representation of a decision maker's beliefs regarding the likely realization of alternative events. In this article, I argue that the choice-theoretic definitions of subjective probabilities involve a tacit convention—namely, state-independent utility functions—that is not implied by the axioms, and, as a consequence, choice-theoretic subjective probabilities, even when they exist, do not necessarily represent the decision makers' beliefs.     

The impossibility of experimental elicitation of subjective probabilities

We show that if decision makers may have stakes in certain events then the experimental elicitation of their subjective probabilities of these events is impossible.We thank Eyal Sulganik for helpful comments on an earlier draft of this paper.     

On the equivalence between descending bid auctions and first price sealed bid auctions

Bidding the same price in descending bid auctions and in first price sealed bid auctions is equivalent to expected utility maximizing behavior, and this is equivalent to dynamically consistent bidding. The claim that, in strategic form, descending bid and first price sealed bid auctions are the same game is thus shown to be false, since the mapping from strategies to payoffs is not the same for the two auction forms.