# An axiomatic approach to ε -contamination

Kiyohiko G. Nishimura, Hiroyuki Ozaki

Research output: Contribution to journalArticle

27 Citations (Scopus)

### Abstract

Suppose that an economic agent is (1-\varepsilon) \times 100% certain that uncertainty she faces is characterized by a particular probability measure, but that she has a fear that, with \varepsilon \times 100% chance, her conviction is completely wrong and she is left perfectly ignorant about the true measure in the present as well as in the future. This situation is often called " varepsilon -contamination of confidence." The purpose of this paper is to provide a simple set of behavioral axioms under which the decision-maker's preference is represented by the Choquet expected utility with the varepsilon -contamination of confidence.

Original language English 333-340 8 Economic Theory 27 2 https://doi.org/10.1007/s00199-004-0584-3 Published - 2006 Feb Yes

### Fingerprint

Contamination
Confidence
Axiomatic approach
Economics
Choquet expected utility
Axioms
Decision maker
Uncertainty

### Keywords

• ε-contamination
• Choquet expected utility
• Representation theorem

### ASJC Scopus subject areas

• Economics and Econometrics

### Cite this

An axiomatic approach to ε -contamination. / Nishimura, Kiyohiko G.; Ozaki, Hiroyuki.

In: Economic Theory, Vol. 27, No. 2, 02.2006, p. 333-340.

Research output: Contribution to journalArticle

Nishimura, Kiyohiko G. ; Ozaki, Hiroyuki. / An axiomatic approach to ε -contamination. In: Economic Theory. 2006 ; Vol. 27, No. 2. pp. 333-340.
@article{c9272e7c56b3477ea99ffab7969d22e5,
title = "An axiomatic approach to ε -contamination",
abstract = "Suppose that an economic agent is (1-\varepsilon) \times 100{\%} certain that uncertainty she faces is characterized by a particular probability measure, but that she has a fear that, with \varepsilon \times 100{\%} chance, her conviction is completely wrong and she is left perfectly ignorant about the true measure in the present as well as in the future. This situation is often called {"} varepsilon -contamination of confidence.{"} The purpose of this paper is to provide a simple set of behavioral axioms under which the decision-maker's preference is represented by the Choquet expected utility with the varepsilon -contamination of confidence.",
keywords = "ε-contamination, Choquet expected utility, Representation theorem",
author = "Nishimura, {Kiyohiko G.} and Hiroyuki Ozaki",
year = "2006",
month = "2",
doi = "10.1007/s00199-004-0584-3",
language = "English",
volume = "27",
pages = "333--340",
journal = "Economic Theory",
issn = "0938-2259",
publisher = "Springer New York",
number = "2",

}

TY - JOUR

T1 - An axiomatic approach to ε -contamination

AU - Nishimura, Kiyohiko G.

AU - Ozaki, Hiroyuki

PY - 2006/2

Y1 - 2006/2

N2 - Suppose that an economic agent is (1-\varepsilon) \times 100% certain that uncertainty she faces is characterized by a particular probability measure, but that she has a fear that, with \varepsilon \times 100% chance, her conviction is completely wrong and she is left perfectly ignorant about the true measure in the present as well as in the future. This situation is often called " varepsilon -contamination of confidence." The purpose of this paper is to provide a simple set of behavioral axioms under which the decision-maker's preference is represented by the Choquet expected utility with the varepsilon -contamination of confidence.

AB - Suppose that an economic agent is (1-\varepsilon) \times 100% certain that uncertainty she faces is characterized by a particular probability measure, but that she has a fear that, with \varepsilon \times 100% chance, her conviction is completely wrong and she is left perfectly ignorant about the true measure in the present as well as in the future. This situation is often called " varepsilon -contamination of confidence." The purpose of this paper is to provide a simple set of behavioral axioms under which the decision-maker's preference is represented by the Choquet expected utility with the varepsilon -contamination of confidence.

KW - ε-contamination

KW - Choquet expected utility

KW - Representation theorem

UR - http://www.scopus.com/inward/record.url?scp=18144423188&partnerID=8YFLogxK

UR - http://www.scopus.com/inward/citedby.url?scp=18144423188&partnerID=8YFLogxK

U2 - 10.1007/s00199-004-0584-3

DO - 10.1007/s00199-004-0584-3

M3 - Article

AN - SCOPUS:18144423188

VL - 27

SP - 333

EP - 340

JO - Economic Theory

JF - Economic Theory

SN - 0938-2259

IS - 2

ER -