Epstein, Larry G.
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CitationLG Epstein, Yoram Halevy. "Ambiguous Correlation." Review of Economic Studies,
Many decisions are made in environments where outcomes are determined by the realization of multiple random events. A decision maker may be uncertain how these events are related. We identify and experimentally substantiate behavior that intuitively reflects a lack of confidence in their joint distribution. Our findings suggest a dimension of ambiguity which is different from that in the classical distinction between risk and "Knightian uncertainty".