Ambiguity Attitudes and Beliefs about Others in the Public Goods Game

This study investigates the Public Goods Game (PGG) and the role of ambiguity attitudes and beliefs about others’ tendency to contribute, in someone’s own contribution decision. The PGG is framed as the environmental issue of sustaining the global climate. This research employed a recently introduced quantitative method that allows to measure ambiguity attitudes for natural events. Such a natural event includes the move of an opponent in the Public Goods Game. This method measures two components of the ambiguity attitude: ambiguity aversion and a(mbiguity)-insensitivity. In addition, the ambiguity neutral beliefs about others’ tendency to contribute, while controlling for ambiguity attitudes, are revealed. The results show that ambiguity plays a role in the contribution decision. Specifically, ambiguity neutral beliefs about others’ tendency to contribute are strongly related to people’s own contributions: optimistic beliefs about others’ are associated with higher contribution levels. This relationship is weakened by a subject’s a-insensitivity. As a result, to what extent subjects are guided by beliefs depends on their ambiguity attitude. The results did not support the expectation that ambiguity aversion decreases contribution. In general, this paper extends prior research by showing how the role of ambiguity attitudes in games can be studied empirically.