COWLES FOUNDATION FOR RESEARCH IN ECONOMICS
AT YALE UNIVERSITY

Box 208281
New Haven, CT 06520-8281

COWLES FOUNDATION DISCUSSION PAPER NO. 1341

Subjective Distributions

Itzhak Gilboa
Tel-Aviv University and Cowles Foundation, Yale University
David Schmeidler
Tel-Aviv University and The Ohio State University

December 2001

A decision maker has to choose one of several random variables, with uncertainty known distributions. As a Bayesian she behaves as if she knew the distributions. In his paper we suggest an axiomatic derivation of these (subjective) distributions, which is much more economical than the derivations by de Finetti or Savage. They derive the whole joint distribution of all the available random variables.

Keywords: Subjective probabilities, expected utility

JEL Classification: D70