Strategic Ambiguity and Decision-Making : An Experimental Study

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). In addition, we note that subjects' ambiguity-attitudes appear to be context dependent: ambiguity-loving in single person decisions and ambiguity-averse in games. This is consistent with the findings of Kelsey and le Roux (2015)