Original Research ARTICLE
Ambiguity and Conflict Aversion when Uncertainty is in the Outcomes
- 1Australian National University, Australia
- 2University of New South Wales, Australia
We argue that the way ambiguity has been operationalized throughout the literature on ambiguity effects has an important limitation, insofar as ambiguity in outcomes has been neglected. We report two studies where judges do encounter ambiguity in the sampled outcomes, and find evidence that ambiguity aversion is not less than when judges are given a range of outcomes without reference to ambiguous outcomes themselves. This result holds regardless of whether people are presented with a sample all at once or sample outcomes sequentially. Our experiments also investigate the effects of conflicting information about outcomes, finding that conflict aversion also does not decrease. Moreover, ambiguity and conflict aversion do not seem to arise as a consequence of judges ignoring uncertain outcomes and thereby treating outcome sets as reduced samples of unambiguous (or unconflicting) information. Instead, ambiguity and conflict aversion are partly explained by more pessimistic outcome forecasts by judges. This pessimism, in turn, may be due to the judges’ uncertainty about how the chance of a desirable outcome from an ambiguous or conflictive alternative compares with an equivalent risky alternative.
Keywords: Decision - making, Ambiguity (or Knightian uncertainty), conflict-aversion, risk, uncertainty
Received: 09 Aug 2018;
Accepted: 25 Feb 2019.
Edited by:George Kachergis, Stanford University, United States
Reviewed by:Jan B. Engelmann, University of Amsterdam, Netherlands
Adam Goodie, University of Georgia, United States
Anna Sagana, Maastricht University, Netherlands
Copyright: © 2019 Smithson, Priest, Shou and Newell. This is an open-access article distributed under the terms of the Creative Commons Attribution License (CC BY). The use, distribution or reproduction in other forums is permitted, provided the original author(s) and the copyright owner(s) are credited and that the original publication in this journal is cited, in accordance with accepted academic practice. No use, distribution or reproduction is permitted which does not comply with these terms.
* Correspondence: Prof. Michael Smithson, Australian National University, Canberra, Australia, Michael.Smithson@anu.edu.au