The paper studies the process of inference formation in strategic decision making that occurs in ontologically uncertain settings, in which knowledge based on previous experience is unavailable or of limited help. We build on a cognitive model of causal inference which has roots into the connectionist tradition.x10The model describes strategic choice formation as a process of selection between competing interpretations of the set of environmental stimuli, in which a plan of action emerges over the others because of its higher level of logical coherence in explaining the available evidence. We show how the model reproduces the major stylized facts that result from a strategic choice case study (the decision of entering into the market with a new mobile technology by a telecommunication corporation). In particular, we show how bad inferences might depend from limited available information and how the emergence of new information can improve the performance in inference formation. Also, we explore to what extent additional information on relevant events and hypotheses, as well as in causal relationship among them, can improve "ex-ante" strategic evaluations of alternatives, thus increasing the overall performance of the whole strategic process. As a final point, we discuss how the model can be applied to action-planning process or decision support systems in order to improve the actual strategic process of real decision makers.
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Paper provided by Department of Computer and Management Sciences, University of Trento, Italy in its series Quaderni DISA with number
117.