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Updated: Jul 7, 2026
13:04
Measuring the Subjective Value of Risky and Ambiguous Options using Experimental Economics and Functional MRI Methods
Published on: September 19, 2012
Size doesn't really matter: ambiguity aversion in Ellsberg urns with few balls
Briony D Pulford1, Andrew M Colman
1School of Psychology, University of Leicester, UK. bdp5@le.ac.uk
Experimental Psychology
|February 15, 2008
Summary
Decision makers often avoid uncertainty, preferring known risks over ambiguous choices. This ambiguity aversion persists regardless of the number of balls in the urn, challenging existing theories.
Area of Science:
- Decision Science
- Behavioral Economics
- Cognitive Psychology
Background:
- Decision makers frequently exhibit ambiguity aversion, preferring known probabilities over unknown ones.
- This behavior contradicts expected utility theory, which assumes rational decision-making under risk and uncertainty.
Purpose of the Study:
- To investigate the impact of urn size on ambiguity aversion.
- To determine if ambiguity aversion is influenced by the scale of the choice set.
Main Methods:
- 149 participants made choices between a known-risk urn (50 red, 50 black balls) and an ambiguous urn (unknown ratio).
- Urn sizes were varied (2, 10, or 100 balls) across experimental conditions.
Main Results:
- A significant ambiguity aversion effect was observed across all tested urn sizes.
- Participants consistently preferred the known-risk urn, even when the total number of balls was small (e.g., 2 balls).
Conclusions:
- Ambiguity aversion is a robust phenomenon, not solely dependent on the complexity or size of the choice set.
- The findings suggest a need to revise theoretical models that explain ambiguity aversion, particularly those emphasizing scale-dependent effects.
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