Ambiguity Effect
A cognitive bias where decision making is affected by a lack of information, or "ambiguity". The effect implies that people tend to select options for which the probability of a favorable outcome is known, over an option for which the probability of a favorable outcome is unknown.
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Origin
Named for Daniel Ellsberg's 1961 paper in the Quarterly Journal of Economics, which introduced what became known as the Ellsberg paradox. Ellsberg — who a decade later would famously leak the Pentagon Papers — showed through a simple urn experiment that people systematically shy away from options where the odds are unknown.
Updated February 22, 2026