This paper extends Harsanyi’s Impartial Observer Theorem by
introducing Knightian Uncertainty in the form of individual belief systems. It
features an axiomatic framework of societal decision-making in the presence
of individual uncertainty. The model allows the analysis of scenarios where
individuals agree on the ranking but not on the likelihood of social outcomes.
The preferences of the impartial observer are represented by a weighted sum of
utilities - each representing individual preferences with different belief systems.
In order to incorporate common criticism of the framework of Harsanyi (1953),
our approach is based on the generalized version by Grant et al. (2010). The
belief systems are introduced as second-order beliefs following Seo (2009).