“In the simplest version of the problem, there are two urns. Inside the first urn are 50 white marbles and 50 black marbles. Inside the second urn is a mix of white and black marbles in an unknown proportion. There may be 99 white marbles and 1 black marble, 98 white marbles and 2 black marbles, and so on, all the way to a possible mix of 1 white marble and 99 black marbles. Now, you get to draw a marble from one of the urns. If you draw a black marble, you win cash. So which urn do you choose? It doesn’t take a lot of thought to figure out that the odds of drawing a black marble are the same from either urn but, as Ellsberg showed, people strongly prefer the first urn. What makes the difference is uncertainty. With both urns, it is uncertain whether you will draw a black or white marble, but with the first urn, unlike the second, there is no uncertainty about the contents, which is enough to make it by far the preferred choice. Our aversion to uncertainty can even make people prefer the certainty of a bad thing to the mere possibility of one. Researchers have shown, for example, that people given a colostomy they knew was permanent were happier six months later than those who had a colostomy that may or may not be permanent. See”