30 Pages Posted: 2 Aug 2016
Date Written: July 30, 2016
We conducted a set of experiments to compare the effect of ambiguity in single person decisions and games. Our results suggest that ambiguity has a bigger impact in games than in ball and urn problems. We find that ambiguity has the opposite effect in games of strategic substitutes and complements. This confirms a theoretical prediction made by Eichberger and Kelsey (2002).
The experiments also test whether subjects' perception of ambiguity differs when faced by a local opponent as opposed to a foreign one. Our results show that there is little evidence of more influence of ambiguity on behaviour when faced by foreign subjects.
Keywords: Ambiguity; Choquet expected utility; strategic complements; strategic substitutes; Ellsberg urn
JEL Classification: C72, C91, D03, D81
Suggested Citation: Suggested Citation
Kelsey, David and le Roux, Sara, Strategic Ambiguity and Decision-Making: An Experimental Study (July 30, 2016). Available at SSRN: https://ssrn.com/abstract=2816797