Visual Attention and Strategic Sophistication in the Strategic Environment Effect: An Eye-Tracking Approach

This study investigates how strategic environments shape a decision maker's reasoning processes by incorporating visual attention and cognitive engagement. Using eye-tracking methods within experimental guessing games featuring interior equilibria, we analyze how strategic complementarity and substitutability alter choice behavior and cognitive engagement. We find that while choices diverge further from equilibrium under strategic complementarity, eye gaze metrics-specifically fixation and transition measures-are consistent with more intensive cognitive engagement under strategic substitutability. Furthermore, by using a novel approach to measure strategic sophistication, we find that individuals with higher strategic aptitude exhibit higher levels of visual engagement with the payoff table. As strategic sophistication increases, the two distinct dimensions of attention build up sequentially rather than together, with attention to an individual's own strategies strengthening prior to attention to their opponents'. These findings indicate that visual attention is shaped systematically by the strategic environment and are consistent with a sequential organization of reasoning that may underlie the strategic environment effect.