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Insights in Decision Making: A Tribute to Hillel J. Einhorn

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This book is a collection of essays in honor of Hillel Einhorn ,whose death at the early age of 46 in 1987 is a tragedy.Einhorn's main interest in decision theory(science?) was decision making under uncertainty/ambiguity.Much of his scholarly output was in association with Robin Hogarth,the editor of this book.Both Einhorn and Hogarth were unaware of the work on decision making under uncertainty/ambiguity undertaken by J M Keynes in his A Treatise on Probability(1921;TP)and the informal extension made by Keynes in his 1936 book,The General Theory, as well as the major advances made by D.Ellsberg in his unpublished 1962 dissertation(published in 2001 by Garland Press as "Risk,Ambiguity,and Decision").A reader, who is aware of these sources, can admire the technical exposition of these collected essays(as well as the technical expertise of Einhorn's work)while also recognizing the limited originality of this work in the light of the work of Keynes and Ellsberg.For instance,the main Einhorn-Hogarth model of decision making under ambiguity that allowed for ambiguity preference,as well as avoidance,and incorporated a variable to account for the attitude of the decision maker towards ambiguity,does not represent any significant advance over the "Restricted Bayes/Hurwicz criterion" contained in chapter 7 of Ellsberg(2001,pp.194-202).The essays in this book by Wallsten,Edwards,and Lichtenstein,Slovic,and their coauthors,make for interesting reading ,as does the essay by Payne and his coauthors.Unfortunately,they also contain errors of omission/commission.The assessment made about Keynes's views in the TP by Wallsten are all incorrect(See Wallsten,pp.31-32)and appear to be based on parts of chapter III of the TP only.This is exactly the same error committed by Frank Ramsey in 1922 and 1926 in his error filled reviews of the TP.It is simply false to state,as Wallsten does,that"Keynes suggested that it would occasionally be possible to put bounds on numerical probabilities...in which case...the probability is only known vaguely."(Wallsten,p.32).The vast majority of Keynesian probabilities are interval estimates.Similarly, the claim that "...virtually all decision theories share the idea that degrees of uncertainty can be represented uniquely and numerically by a probability measure..."(Wallsten,p.32)means that the message of Ellsberg(who uses sets of probability distributions) and Keynes has still not gotten through yet.