Ambiguous games: Evidence for strategic ambiguity aversion

Pulford, Briony D. and Colman, Andrew M. (2007): Ambiguous games: Evidence for strategic ambiguity aversion. Published in: Quarterly Journal of Experimental Psychology , Vol. 8, No. 60 (2007): pp. 1083-1100.

Abstract

The problem of ambiguity in games is discussed, and a class of ambiguous games is identified. 195 participants played strategic-form games of various sizes with unidentified co-players. In each case, they first chose between a known-risk game involving a co-player indifferent between strategies and an equivalent ambiguous game involving one of several co-player types, each with a different dominant strategy, then they chose a strategy for the preferred game. Half the players knew that the ambiguous co-player types were equally likely, and half did not. Half expected the outcomes to be known immediately, and half expected a week’s delay. Known-risk games were generally preferred, confirming a significant strategic ambiguity aversion effect. In the delay conditions, players who knew that the ambiguous co-player types were equally likely were significantly less ambiguity-averse than those who did not. Decision confidence was significantly higher in 2 × 2 than larger games.

• Item Type: MPRA Paper
• Language: English
• Keywords: ambiguity aversion; behavioural game theory; confidence; decision making; Ellsberg paradox; incomplete information; intolerance of uncertainty; psychological game theory; subjective expected utility.
• Subjects: C - Mathematical and Quantitative Methods > C7 - Game Theory and Bargaining Theory; C - Mathematical and Quantitative Methods > C7 - Game Theory and Bargaining Theory > C72 - Noncooperative Games; C - Mathematical and Quantitative Methods > C9 - Design of Experiments > C90 - General; C - Mathematical and Quantitative Methods > C9 - Design of Experiments > C92 - Laboratory, Group Behavior; D - Microeconomics > D8 - Information, Knowledge, and Uncertainty > D81 - Criteria for Decision-Making under Risk and Uncertainty

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