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on Game Theory |
| By: | Inés Macho-Stadler (Department of Economics, Universidad Autónoma de Barcelona); David Pérez-Castrillo (Department of Economics, Universidad Autónoma de Barcelona); Nicolás Porteiro (Department of Economics, Universidad Pablo de Olavide) |
| Abstract: | We study a sequential protocol of endogenous coalition formation based on a process of bilateral agreements among the players. We apply the game to a Cournot environment with linear demand and constant average costs. We show that the final outcome of any Subgame Perfect Equilibrium of the game is the grand coalition, provided the initial number of firms is high enough and they are sufficiently patient. |
| Keywords: | Coalition formation, bilateral agreements, Cournot. |
| JEL: | C72 D62 D40 |
| Date: | 2006–02 |
| URL: | http://d.repec.org/n?u=RePEc:pab:wpaper:06.01&r=gth |
| By: | Aurora Garcia-Gallego (LEE/LINEEX and Dpt Economics, Universitat Jaume I); Nikolaos Georgantzis (LEE/LINEEX and Dpt Economics, Universitat Jaume I); Maria Jose Gil Molto (Dpt Economics, Loughborough University); Vicente Orts (IEI, LEE and Dpt Economics, Universitat Jaume I) |
| Abstract: | We experimentally test the hypothesis that players' valuations of a game coincide with their Nash equilibrium earnings. Our results offer significantly less support for this hypothesis than for the prediction of dominant strategy play. |
| Keywords: | Game Value, Subgame Perfection, Dominant Strategies, Behavioral Game Theory |
| JEL: | C72 C91 |
| Date: | 2006–04 |
| URL: | http://d.repec.org/n?u=RePEc:lbo:lbowps:2006_4&r=gth |
| By: | Dirk Engelmann; Veronika Grimm |
| Abstract: | We experimentally study behavior in a simple voting game where players have private information about their preferences. With random matching, subjects overwhelmingly follow the dominant strategy to exaggerate their preferences. Applying the linking mechanism suggested by Jackson and Sonnenschein (2005) captures nearly all achievable efficiency gains. Repeated interaction leads to significant gains in truthful representation and efficiency only if players can choose their partners. |
| Keywords: | Experimental Economics, Mechanism Design, Implementation, Linking, Bayesian Equilibrium, Efficiency |
| JEL: | A13 C72 C91 C92 D64 D72 D80 |
| Date: | 2006–02–28 |
| URL: | http://d.repec.org/n?u=RePEc:kls:series:0022&r=gth |
| By: | Dirk Engelmann; Veronika Grimm |
| Abstract: | We present laboratory experiments of five different multi-unit auction mechanisms. Two units of a homogeneous object were auctioned off among two bidders with flat demand for two units. We test whether expected demand reduction occurs in open and sealed-bid uniform-price auctions. Revenue equivalence is tested for these auctions as well as for the Ausubel, the Vickrey and the discriminatory sealed-bid auction. Furthermore, we compare the five mechanisms with respect to the efficient allocation of the units. |
| Keywords: | Multi-Unit Auctions, Demand Reduction, Experimental Economics |
| JEL: | D44 C91 |
| Date: | 2006–02–28 |
| URL: | http://d.repec.org/n?u=RePEc:kls:series:0024&r=gth |