Abstract
Ever since Knight’s (1921) seminal work, some economists have drawn a distinction between uncertainty and risk — in order to demonstrate that this difference has important implications for understanding the operations of an entrepreneurial economy. Lawson (1985) is the latest to discuss the need for the analysis of ‘societal interaction’1 in an economic world where ‘[uncertainty, as opposed to mathematical risk, is a pervasive fact of life’ (p. 909). Lawson correctly associates the concept of uncertainty with the situation
where there is no basis whatever upon which to form any calculable probability … Uncertainty in this account arises when the probability relation is numerically indeterminate and non-comparable to other probability relations (1985, p. 914).
Cambridge Journal of Economics, September 1988.
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© 1991 Paul Davidson
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Davidson, P. (1991). A Technical Definition of Uncertainty and the Long-run Non-neutrality of Money. In: Davidson, L. (eds) Inflation, Open Economies and Resources. Palgrave Macmillan, London. https://doi.org/10.1007/978-1-349-11516-7_15
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