An Axiomatic Characterization of Bayesian Updating

B-Tier
Journal: Journal of Mathematical Economics
Year: 2023
Volume: 104
Issue: C

Authors (2)

Alós-Ferrer, Carlos (Lancaster University) Mihm, Maximilian (not in RePEc)

Score contribution per author:

1.005 = (α=2.01 / 2 authors) × 1.0x B-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

We provide an axiomatic characterization of Bayesian updating, viewed as a mapping from prior beliefs and new information to posteriors, which is disentangled from any reference to preferences. Bayesian updating is characterized by Non-Innovativeness (events considered impossible in the prior remain impossible in the posterior), Dropping (events contradicted by new evidence are considered impossible in the posterior), and Proportionality (for other events, the posterior simply rescales the prior’s probabilities proportionally). The result clarifies the differences between the normative Bayesian benchmark, alternative models, and actual human behavior.

Technical Details

RePEc Handle
repec:eee:mateco:v:104:y:2023:i:c:s0304406822001252
Journal Field
Theory
Author Count
2
Added to Database
2026-01-24