Optimism and Pessimism in Games
AbstractThis paper considers the impact of ambiguity in strategic situations. It extends the earlier literature by allowing for optimistic responses to ambiguity. Ambiguity is modelled by CEU preferences. We propose a new solution concept for players who may express ambiguity- preference. Then we study comparative statics of changes in ambiguity-attitude in games with strategic complements. This gives a precise statement of the impact of ambiguity on economic behaviour.
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Bibliographic InfoPaper provided by Exeter University, Department of Economics in its series Discussion Papers with number 0905.
Date of creation: 2009
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Ambiguity in games; support; strategic complementarity; optimism; multiple equilibria.;
Other versions of this item:
- C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
- D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty
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- Daniel Laskar, 2013. "Ambiguity, Pessimism, Optimism and Financial Crises in a Simple Global Game Model," PSE Working Papers hal-00811923, HAL.
- Jürgen Eichberger & David Kelsey, 2008.
"Are the Treasures of Game Theory Ambiguous?,"
0469, University of Heidelberg, Department of Economics, revised Jul 2008.
- Thomas Jungbauer & Klaus Ritzberger, 2011. "Strategic games beyond expected utility," Economic Theory, Springer, vol. 48(2), pages 377-398, October.
- Diamantaras, Dimitrios & Gilles, Robert P., 2011.
"Ambiguity, social opinion and the use of common property resources,"
Journal of Economic Behavior & Organization,
Elsevier, vol. 80(1), pages 210-222.
- Dimitrios Diamantaras & Robert P. Gilles, 2010. "Ambiguity, Social Opinion and the Use of Common Property Resources," DETU Working Papers 1006, Department of Economics, Temple University.
- repec:hal:wpaper:hal-00811923 is not listed on IDEAS
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