Preference robust distortion risk measures

Carole Bernard (Vrije U Brussels)

Feb 10. 2026, 11:10 — 11:45

We introduce a framework for preference-robust decision making when preferences over risk are modelled through generalized distortion risk measures. Unlike distributional robustness, our approach addresses ambiguity in the risk functional itself. We construct ambiguity sets on distortion (weight) functions using  the Wasserstein distance and Bregman divergences, and derive closed-form expressions for the worst- and best-case distortion risk measures. We further extend the framework to Rank-Dependent Expected Utility, yielding preference-robust behavioural models. 

This is joint work with Silvana Pesenti (University of Toronto).

Further Information
Venue:
ESI Boltzmann Lecture Hall
Associated Event:
Probabilistic Mass Transport - from Schrödinger to Stochastic Analysis (Workshop)
Organizer(s):
Beatrice Acciaio (ETH Zurich)
Julio Backhoff (U of Vienna)
Daniel Bartl (U of Vienna)
Mathias Beiglböck (U of Vienna)
Sigrid Källblad (KTH Stockholm)
Walter Schachermayer (U of Vienna)