Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/181358 
Year of Publication: 
2018
Series/Report no.: 
CESifo Working Paper No. 7158
Publisher: 
Center for Economic Studies and ifo Institute (CESifo), Munich
Abstract: 
We formulate a simple quantum decision model of the Ellsberg paradox. We report the results of an experiment we performed to test the matching probabilities predicted by this model using an incentive compatible method. We find that the theoretical predictions of the model are in conformity with our experimental results. We compare the predictions of our quantum model with those of probably the most successful non-quantum model of ambiguity, namely, the source dependent model. The predictions of our quantum model are not statistically significantly different from those of the source dependent model. The source dependent model requires the specification of probability weighting functions in order to fit the evidence. On the other hand, our quantum model makes no recourse to probability weighting functions. This suggests that much of what is normally attributed to probability weighting may actually be due to quantum probability.
Subjects: 
quantum probability
the Ellsberg paradox
the source dependent model
the law of total probability
the law of reciprocity
the Feynman rules
projective expected utility
bounded rationality
Diebold-Mariano forecasting tests
JEL: 
D03
Document Type: 
Working Paper
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