Question

How many levels of reasoning an average person uses in strategic situations?”. What are the some potential consequences of limited strategic sophistication in strategic situations?

Answer 1

Ans - There are two levels of reasoning in strategic situations that an average person uses-

1- Low level of strategic reasoning (Level 1 or Lower)

2- High level of strategic reasoning (Level 2 or higher) The high level of strategic reasoning subjects clearly differentiated their behaviour in the human compared to the computer condition.

Strategic sophistication underpins the ability to succeed in life and it has main three consequences-

First we find the theory- of-mind and cognitive ability.

Second many subjects ignore the incentive and rationality of others.

And third the notion of heterogeneous stratigic sophistication operating through limited iterations of best response dates back.