Cognitive ability and the effect of strategic uncertainty

Nobuyuki Hanaki (1) , Nicolas Jacquemet (2, 3) , Stéphane Luchini (4) , Adam Zylbersztejn (5)

1 GREDEG - Groupe de Recherche en Droit, Economie et Gestion
2 BETA - Bureau d'Économie Théorique et Appliquée
3 PSE - Paris School of Economics
4 GREQAM - Groupement de Recherche en Économie Quantitative d'Aix-Marseille
5 GATE - Groupe d'analyse et de théorie économique

How is one's cognitive ability related to the way one responds to strategic uncertainty? We address this question by conducting a set of experiments in simple 2 x 2 dominance solvable coordination games. Our experiments involve two main treatments: one in which two human subjects interact, and another in which one human subject interacts with a computer program whose behavior is known. By making the behavior of the computer perfectly predictable, the latter treatment eliminates strategic uncertainty. We find that subjects with higher cognitive ability are more sensitive to strategic uncertainty than those with lower cognitive ability.

Mots clés: Strategic Uncertainty; Bounded Rationality; Robot; Experiment

Domaines: Economies et finances

Nobuyuki Hanaki, Nicolas Jacquemet, Stéphane Luchini, Adam Zylbersztejn. Cognitive ability and the effect of strategic uncertainty. 2015. ⟨halshs-01229612⟩