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on Game Theory |
| By: | Grimm, Veronika; Mengel, Friederike (METEOR) |
| Abstract: | We study experimentally how players learn to make decisions if they face many different (normal-form) games. Games are generated randomly from a uniform distribution in each of 100 rounds. We find that agents do extrapolate between games but learn to play strategically equivalent games in the same way. If either there are few games or if explicit information about the opponent''s behavior is provided (or both) convergence to the unique Nash equilibrium generally occurs. Otherwise this is not the case and play converges to a distribution of actions which is Non-Nash. Action choices, though, that cannot be explained by theoretical models of either belief-bundling or action bundling are never observed. Estimating different learning models we find that Nash choices are best explained by finer categorizations than Non-Nash choices. Furthermore participants scoring better in the "Cognitive Reflection Test" choose Nash actions more often than other participants. |
| Keywords: | microeconomics ; |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:umamet:2009007&r=gth |
| By: | Atila Abdulkadiroglu; Parag A. Pathak; Alvin E. Roth |
| Abstract: | The design of the New York City (NYC) High School match involved tradeoffs among efficiency, stability and strategy-proofness that raise new theoretical questions. We analyze a model with indifferences--ties--in school preferences. Simulations with field data and the theory favor breaking indifferences the same way at every school --single tie breaking-- in a student-proposing deferred acceptance mechanism. Any inefficiency associated with a realized tie breaking cannot be removed without harming student incentives. Finally, we empirically document the extent of potential efficiency loss associated with strategy-proofness and stability, and direct attention to some open questions. |
| JEL: | C78 D60 I20 |
| Date: | 2009–04 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:14864&r=gth |
| By: | Edgar Sanchez Carrera |
| Abstract: | We study an evolutionary game in which the individual behavior of the economic agents can lead the economy either into a low-level or a high-level equilibrium. The model represents two asymmetric populations, “leaders and followers”, where in each round an economic agent of population 1 is paired with a member of population 2. Our evolutionary game is a signaling game in which only the leader has private information. The leader moves first; the follower observes the leader's action, but not the leader's type, before choosing her own action. We found the equilibria both as self-confirming and evolutionarily stable strategies. Furthermore, considering an imitative behavior of the followers, we show that to overcome the poverty trap there exists a threshold value equals to the ratio "education costs-efficiency wages" of the number of high-profile economic agents |
| Keywords: | Evolutionary games, imitation rule, poverty traps, replicator dynamics, signaling games, strategic complementarities |
| JEL: | C70 C72 C73 I30 O10 O40 |
| Date: | 2009–02 |
| URL: | http://d.repec.org/n?u=RePEc:usi:wpaper:555&r=gth |
| By: | Anders U. Poulsen (School of Economics, University of East Anglia); Michael V. M. Roos (Fakultät für Wirtschaftswissenschaft, Ruhr-Universität Bochum) |
| Abstract: | The strategic commitment moves that game theory predicts players make may sometimes seem counter-intuitive. We therefore conducted an experiment to see if people make the predicted strategic move. The experiment uses a simple bargaining situation. A player can make a strategic move of committing to not seeing what another player will demand. Our data show that subjects do, but only after substantial time, learn to make the predicted strategic move. We find only weak evidence of physical timing effects. |
| Keywords: | strategic moves; commitment; bargaining; strategic value of information; physical timing effects; endogenous timing; experiment |
| JEL: | C72 C78 C90 C92 D63 D80 |
| Date: | 2009–02 |
| URL: | http://d.repec.org/n?u=RePEc:kud:kuiedp:0906&r=gth |
| By: | Tomoki Inoue (Institute of Mathematical Economics, Bielefeld University) |
| Abstract: | We consider an exchange economy where every commodity can be consumed only in integer amounts. Inoue [Inoue, T., 2005. Do pure indivisibilities prevent core equivalence? Core equivalence theorem in an atomless economy with purely indivisible commodities only. Journal of Mathematical Economics 41, 571-601] proved that in such an economy with a continuum of agents, the core coincides with the set of Walras allocations. We show that this equivalence holds only in an atomless economy by giving two examples of the sequence of replica economies such that in any replica economy, there exists a core allocation that is not a Walras allocation. |
| Keywords: | indivisible commodities, core, Walras equilibrium, strong core, cost-minimized Walras equilibrium |
| JEL: | C71 D51 |
| Date: | 2009–03 |
| URL: | http://d.repec.org/n?u=RePEc:bie:wpaper:419&r=gth |
| By: | Kukushkin, Nikolai S. |
| Abstract: | For a correspondence from a partially ordered set to a lattice, three sets of sufficient conditions for the existence of a monotone selection are obtained. (1) The correspondence is weakly ascending while each value is chain-complete. (2) The correspondence is ascending while the target is a sublattice of the Cartesian product of a finite number of chains. (3) Both source and target are chains while the correspondence is generated by the maximization of a strongly acyclic interval order with the single crossing property. The theorems give new sufficient conditions for the existence of (epsilon) Nash equilibria. |
| Keywords: | Monotone selection; (weakly) ascending correspondence; interval order; single crossing; (epsilon) Nash equilibrium |
| JEL: | C72 |
| Date: | 2009–04–03 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:14451&r=gth |
| By: | Coralio Ballester (Universidad de Alicante); Antoni Calvó-Armengol (ICREA,Universitat Autònoma de Barcelona); Yves Zenou (Stockholm University, Research Institute of Industrial Economics (IFN) and CREAM) |
| Abstract: | Delinquents are embedded in a network of relationships. Social ties among delinquents are modeled by means of a graph where delinquents compete for a booty and benefit from local interactions with their neighbors. Each delinquent decides in a non-cooperative way how much delinquency effort he will exert. Using the network model developed by Ballester et al. (2006), we characterize the Nash equilibrium and derive an optimal enforcement policy, called the key-player policy, which targets the delinquent who, once removed, leads to the highest aggregate delinquency reduction. We then extend our characterization of optimal single player network removal for delinquency reduction, the key player, to optimal group removal, the key group. We also characterize and derive a policy that targets links rather than players. Finally, we endogenize the network connecting delinquents by allowing players to join the labor market instead of committing delinquent offenses. The key-player policy turns out to be much more complex since it depends on wages and on the structure of the network. |
| Date: | 2008–04 |
| URL: | http://d.repec.org/n?u=RePEc:crm:wpaper:200912&r=gth |
| By: | Tomoki Inoue (Institute of Mathematical Economics, Bielefeld University) |
| Abstract: | We consider a pure exchange economy with finitely many indivisible commodities that are available only in integer quantities. We prove that in such an economy with a sufficiently large number of agents, but finitely many agents, the strong core coincides with the set of cost-minimized Walras allocations. Because of the indivisibility, the preference maximization does not imply the cost minimization. A cost-minimized Walras equilibrium is a state where, under some price vector, all agents satisfy both the preference maximization and the cost minimization. |
| Keywords: | Indivisible commodities, strong core, cost-minimized Walras equilibrium, core equivalence |
| JEL: | C71 D51 |
| Date: | 2009–03 |
| URL: | http://d.repec.org/n?u=RePEc:bie:wpaper:417&r=gth |
| By: | Tomoki Inoue (Institute of Mathematical Economics, Bielefeld University) |
| Abstract: | We consider an atomless exchange economy with indivisible commodities. Every commodity can be consumed only in integer amounts. In such an economy, because of the indivisibility, the preference maximization does not imply the cost minimization. We prove that the strong core coincides with the set of cost-minimized Walras allocations which satisfy both the preference maximization and the cost minimization under the same price vector. |
| Keywords: | indivisible commodities, core equivalence, strong core, cost-minimized Walras equilibrium |
| JEL: | C71 D51 |
| Date: | 2009–03 |
| URL: | http://d.repec.org/n?u=RePEc:bie:wpaper:418&r=gth |
| By: | Daniela Del Boca; Christopher Flinn |
| Abstract: | There is a long history of the theoretical and empirical investigation of the labor supply decisions of married women. Perhaps the starting point for modern econometric analysis of this question is Heckman (1974), in which a neoclassical model of wives’ labor supply was estimated using disaggregated data. He explicitly estimated the parameters characterizing a household utility function, which included as arguments the leisure levels of wives and household consumption. With the addition of a wage function, Heckman was able to consistently estimate household preference parameters and the wage function in a manner that eliminated the types of endogenous sampling problems known to create estimator bias when the participation decision is ignored.... |
| Keywords: | Household Time Allocation, Grim Trigger Strategy, Household Production, Method of Simulated Moments |
| JEL: | C79 D19 J22 |
| Date: | 2009–02 |
| URL: | http://d.repec.org/n?u=RePEc:wpc:wplist:wp08_09&r=gth |