Abstract This paper introduces a new approach to modeling the expanding universe of decision makers in the wake of growing awareness, and invokes the axiomatic approach to model the evolution of decision makers' beliefs as awareness grows. The expanding universe is accompanied by extension of the set of acts, the preference relations over which are linked by a new axiom, invariant risk preferences, asserting that the ranking of lotteries is independent of the set of acts under consideration. The main results are representation theorems and rules for updating beliefs over expanding state spaces and null events that have the flavor of "reverse Bayesianism."

Abstract We study the informational effectiveness of electoral campaigns. Voters may not think about all political issues and have incomplete information with regard to political positions of candidates. Nevertheless, we show that if candidates are allowed to microtarget voters with messages then election outcomes are as if voters have full awareness of political issues and complete information about candidate's political positions. Political competition is paramount for overcoming the voter's limited awareness of political issues but unnecessary for overcoming just uncertainty about candidates' political positions. Our positive results break down if microtargeting is not allowed or voters lack political reasoning abilities. Yet, in such cases, negative campaigning comes to rescue.

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literature and the special issue

Unawareness refers to the lack of conception rather than the lack of information. This chapter discusses various epistemic approaches to modeling (un)awareness from computer science and economics that have been developed over the last 25 years. While the focus is on axiomatizations of structures capable of modeling knowledge and propositionally determined awareness, we also discuss structures for modeling probabilistic beliefs and awareness as well as structures for awareness of unawareness. Further topics, such as dynamic awareness, games with unawareness, decision theory under unawareness, and applications are just

We develop awareness-dependent subjective expected utility by taking unaware-ness structures introduced in Heifetz, Meier, and Schipper (2006, 2008, 2011a) as primitives in the Anscombe-Aumann approach to subjective expected utility. We observe that a decision maker is unaware of an event if and only if her choices reveal that the event is “null ” and the negation of the event is “null”. Moreover, we characterize “impersonal ” expected utility that is behaviorally indistinguishable from awareness-dependent subject expected utility and assigns probability zero to some subsets of states that are not necessarily events. We discuss in what sense probability zero can model unawareness.