The predictive role of counterfactuals

A. Di Tillio, I. GILBOA, L. Samuelson

Theory and Decision

February 2013, vol. 74, n°2, pp.167-182

Departments: Economics & Decision Sciences, GREGHEC (CNRS)

Keywords: Induction, Counterfactuals, Prediction

We suggest a model that describes how counterfactuals are constructed and justified. The model can describe how counterfactual beliefs are updated given the unfolding of actual history. It also allows us to examine the use of counterfactuals in prediction, and to show that a logically omniscient reasoner gains nothing from using counterfactuals for prediction