Ambiguity and social interaction
We present a non-technical account of ambiguity in strategic games and show how it may be applied to economics and social sciences. Optimistic and pessimistic responses to ambiguity are formally modelled. We show that pessimism has the effect of increasing (decreasing) equilibrium prices under Courn...
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| Main Authors: | , , |
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| Format: | Book/Monograph Working Paper |
| Language: | English |
| Published: |
Mannheim [u.a.]
Sonderforschungsbereich/Transregio 15
2005
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| Series: | SFB/TR 15 Discussion Paper
59 |
| In: |
Discussion papers (59)
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| Subjects: | |
| Online Access: | Resolving-System, Volltext: http://hdl.handle.net/10419/94022 Resolving-System, Volltext: http://nbn-resolving.de/urn:nbn:de:bvb:19-epub-13491-0 
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| Author Notes: | Jürgen Eichberger; David Kelsey; Burkhard C. Schipper |
| Summary: | We present a non-technical account of ambiguity in strategic games and show how it may be applied to economics and social sciences. Optimistic and pessimistic responses to ambiguity are formally modelled. We show that pessimism has the effect of increasing (decreasing) equilibrium prices under Cournot (Bertrand) competition. In addition the effects of ambiguity on peace-making are examined. It is shown that ambiguity may select equilibria in coordination games with multiple equilibria. Some comparative statics results are derived for the impact of ambiguity in games with strategic complements. |
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| Physical Description: | Online Resource |
| Format: | Systemvoraussetzungen: Acrobat Reader. |