Comparative Ignorance
Tversky and Fox (1995) addressed ambiguity aversion, the idea that people do not like ambiguous gambles or choices with ambiguity, with the comparative ignorance framework. Their idea was that people are only ambiguity averse when their attention is specifically brought to the ambiguity by comparing an ambiguous option to an unambiguous option. For instance, people are willing to bet more on choosing a correct colored ball from an urn containing equal proportions of black and red balls than an urn with unknown proportions of balls when evaluating both of these urns at the same time. However, when evaluating them separately, people are willing to bet approximately the same amount on either urn. Thus, when it is possible to compare the ambiguous gamble to an unambiguous gamble people are averse — but not when one is ignorant of this comparison.
Read more about this topic: Amos Tversky
Famous quotes containing the words comparative and/or ignorance:
“The utmost familiarity with dead streams, or with the ocean, would not prepare a man for this peculiar navigation; and the most skillful boatman anywhere else would here be obliged to take out his boat and carry round a hundred times, still with great risk, as well as delay, where the practiced batteau-man poles up with comparative ease and safety.”
—Henry David Thoreau (1817–1862)
“It’s innocence when it charms us, ignorance when it doesn’t.”
—Mignon McLaughlin (b. c. 1915)