Belief revision generalized: a joint characterization of Bayes's and Jeffrey's rules

Dietrich, Franz, List, Christian ORCID: 0000-0003-1627-800X and Bradley, Richard ORCID: 0000-0003-2184-7844 (2015) Belief revision generalized: a joint characterization of Bayes's and Jeffrey's rules. Journal of Economic Theory, 162. pp. 352-371. ISSN 0022-0531

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Abstract

We present a general framework for representing belief-revision rules and use it to characterize Bayes's rule as a classical example and Jeffrey's rule as a non-classical one. In Jeffrey's rule, the input to a belief revision is not simply the information that some event has occurred, as in Bayes's rule, but a new assignment of probabilities to some events. Despite their differences, Bayes's and Jeffrey's rules can be characterized in terms of the same axioms: responsiveness, which requires that revised beliefs incorporate what has been learnt, and conservativeness, which requires that beliefs on which the learnt input is ‘silent’ do not change. To illustrate the use of non-Bayesian belief revision in economic theory, we sketch a simple decision-theoretic application.

Item Type:	Article
Official URL:	http://www.sciencedirect.com/science/journal/00220...
Additional Information:	© 2015 Elsevier Inc.
Divisions:	Government Philosophy, Logic and Scientific Method CPNSS
Subjects:	B Philosophy. Psychology. Religion > B Philosophy (General) H Social Sciences > HB Economic Theory
JEL classification:	C - Mathematical and Quantitative Methods > C7 - Game Theory and Bargaining Theory > C73 - Stochastic and Dynamic Games; Evolutionary Games; Repeated Games D - Microeconomics > D0 - General > D01 - Microeconomic Behavior: Underlying Principles D - Microeconomics > D8 - Information, Knowledge, and Uncertainty > D80 - General D - Microeconomics > D8 - Information, Knowledge, and Uncertainty > D81 - Criteria for Decision-Making under Risk and Uncertainty D - Microeconomics > D8 - Information, Knowledge, and Uncertainty > D83 - Search; Learning; Information and Knowledge; Communication; Belief D - Microeconomics > D9 - Intertemporal Choice and Growth > D90 - General
Date Deposited:	06 Jan 2016 11:08
Last Modified:	12 Dec 2024 00:58
URI:	http://eprints.lse.ac.uk/id/eprint/64836

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