On the Smooth Ambiguity Model: A Reply

Peter Klibanoff*, Massimo Marinacci, Sujoy Mukerji

*Corresponding author for this work

Research output: Contribution to journalLetterpeer-review

27 Scopus citations


We find that Epstein's (2010) Ellsberg-style thought experiments pose, contrary to his claims, no paradox or difficulty for the smooth ambiguity model of decision making under uncertainty developed by Klibanoff, Marinacci, and Mukerji (2005). Not only are the thought experiments naturally handled by the smooth ambiguity model, but our reanalysis shows that they highlight some of its strengths compared to models such as the maxmin expected utility model (Gilboa and Schmeidler (1989)). In particular, these examples pose no challenge to the model's foundations-interpretation of the model as affording a separation of ambiguity and ambiguity attitude or the potential for calibrating ambiguity attitude in the model.

Original languageEnglish (US)
Pages (from-to)1303-1321
Number of pages19
Issue number3
StatePublished - May 2012


  • Ambiguity
  • Ambiguity aversion
  • Ambiguity hedging
  • Ellsberg
  • Full state space
  • Multiple priors
  • Second order acts
  • Separation of ambiguity from ambiguity attitude
  • Smooth ambiguity model

ASJC Scopus subject areas

  • Economics and Econometrics


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