Consumer Decision-making under Uncertainty on Digital Platforms∗

Inspired by the ride-sharing market in New Zealand, with Uber and Zoomy offering respectively a fixed price and an estimated price range per ride, we ask ourselves if competitors in the digital economy could deliberately offer distinct pricing schemes aimed at serving consumers with different levels of ambiguity tolerance to gain market shares. Our results suggest that in spite of the realistic asymmetric distribution of ambiguity-loving versus ambiguity-averse consumers calibrated with the distribution of the attitudes toward ambiguity obtained in a suitable preliminary laboratory experiment in equilibrium both platforms offering respectively a fixed price and an estimated price range per ride can coexist in the market: Ambiguityloving consumers are attracted toward the price range offers, whereas ambiguity averse consumers shy away from them.