# SFB 303 Discussion Paper No. A - 365

**Author**: Machina, Mark J., and David Schmeidler

**Title**: A More Robust Definition of Subjective Probability

**Abstract**: The goal of choice-theoretic derivations of subjective probability is
to separate a decision maker's underlying beliefs (subjective probabilities
of events) from their preferences (attitudes toward risk). Classical
derivations have all relied upon some form of the Marshak-Samuelson
"Independence Axiom" or the Savage "Sure-Thing Principle", which imply that
preferences over lotteries conform to the expected utility hypothesis. This
paper presents a choice-theoretic derivation of subjective uncertainty,
which neither assumes nor implies that the decision maker's preferences over
lotteries necessarily conform to the expected utility hypothesis.

**Keywords**: Subjective probability, uncertainty, subjective uncertainty,
non-expected utility theory, expected utility theory, Leonard J. Savage

**JEL-Classification-Number**:

**Creation-Date**: March 1992

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