|
on Game Theory |
| By: | Lovo , Stefano (HEC); Tomala , Tristan |
| Abstract: | We introduce the model of Stochastic Revision Games where a finite set of players control a state variable and receive payoffs as a function of the state at a terminal deadline. There is a Poisson clock which dictates when players are called to choose of revise their actions. This paper studies the existence of Markov perfect equilibria in those games. We give an existence proof assuming some form of correlation. |
| Keywords: | Stochastic Revision Games; Games Theory; Equilibria |
| JEL: | C73 |
| Date: | 2015–09–01 |
| URL: | http://d.repec.org/n?u=RePEc:ebg:heccah:1093&r=all |
| By: | Gudmundsson, Jens; Habis, Helga |
| Abstract: | We examine assignment games, wherematched pairs of firms and workers create some monetary value to distribute among themselves and the agents aim to maximize their payoff. In the majority of this literature, externalities - in the sense that a pair’s value depends on the pairing of the others - have been neglected. However, inmost applications a firm’s success depends on, say, the success of its rivals and suppliers. Thus, it is natural to ask how the classical results on assignment games are affected by the introduction of externalities? The answer is – dramatically. We find that (i) a problem may have no stable outcome, (ii) stable outcomes can be inefficient (not maximize total value), (iii) efficient outcomes can be unstable, and (iv) the set of stable outcomes may not form a lattice. We show that stable outcomes always exist if agents are "pessimistic." This is a knife-edge result: there are problems in which the slightest optimism by a single pair erases all stable outcomes. |
| Keywords: | two-sided matching, assignment game, externalities, stability, efficiency |
| JEL: | C71 C78 D62 |
| Date: | 2015–09–18 |
| URL: | http://d.repec.org/n?u=RePEc:cvh:coecwp:2015/16&r=all |
| By: | Stephan Schosser (Faculty of Economics and Management, Otto-von-Guericke University Magdeburg); Bodo Vogt (Faculty of Economics and Management, Otto-von-Guericke University Magdeburg) |
| Abstract: | Subjects in the loss domain tend to split payoffs equally when bargaining. The ultimatum game offers an ideal mechanism through which economists can investigate whether equal splits are the consequence of proposer generosity or due to their anticipation that the responders will reject lower offers. This paper experimentally compares ultimatum bargaining in a loss domain with that under gains. The results reveal that, although responders do not expect more in the loss domain, proposers do make higher offers. As such, proposers reach agreements more often in the loss domain than they do in the gains domain, and responders receive higher payoffs. |
| Keywords: | Ultimatum bargaining, losses, equal split, experimental economics |
| JEL: | C72 C92 D74 |
| Date: | 2015–07 |
| URL: | http://d.repec.org/n?u=RePEc:mag:wpaper:150009&r=all |
| By: | Peters H.J.M.; Zarzuelo J.M. (GSBE) |
| Abstract: | We present an axiomatic characterization of the Owen-Shapley spatial power index for the case where issues are elements of two-dimensional space. This characterization employs a version of the transfer condition, which enables us to unravel a spatial game into spatial games connected to unanimity games. The other axioms are spatial versions of anonymity and dummy, and two conditionsconcerned particularly with the spatial positions of the players. We show that these axioms are logically independent. |
| Keywords: | Cooperative Games; Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior; |
| JEL: | C71 D72 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:unm:umagsb:2015015&r=all |
| By: | L. Becchetti; V. Pelligra; F. Salustri |
| Abstract: | We use the Vote-with-the-Wallet game (VWG) to model socially or environmentally responsible consumption, an increasingly relevant but still under-researched phenomenon. Based on a theoretical model outlining game equilibria and the parametric interval of the related multiplayer prisoners’ dilemma (PD) we evaluate with a controlled lab experiment players’ behavior in the game and test the effects of an ex post redistribution mechanism between defectors and cooperators. Our findings document that the redistribution mechanism interrupts cooperation decay and stabilizes the share of cooperators at a level significantly higher, even though inferior to the Nash equilibrium. |
| Keywords: | vote with the wallet, prisoner’s dilemma, lab experiment |
| JEL: | C72 C73 C91 M14 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:cns:cnscwp:201512&r=all |
| By: | Stoetzer, Matthias Wolfgang; Blass, Tom; Grimm, Anika; Gwosdz, Robert; Schwarz, Jan |
| Abstract: | Die vorliegende Arbeit untersucht das Fairnessverhalten von Studierenden unter-schiedlicher Studienrichtung. Hierzu wurden 289 Studierende der Ernst-Abbe-Hochschule Jena vor zwei verschiedene Entscheidungssituationen gestellt. In diesem Befragungsexperiment mussten die Studierenden wählen, wie viel von 100 EUR sie einem unbekannten Mitspieler überlassen würden. Beim Ultimatumspiel hatte der Mitspieler ein Vetorecht, beim Diktatorspiel nicht. Ziel war es erstens zu ermitteln, inwieweit Fairness, bzw. altruistisches Verhalten einerseits oder egoistisches Verhalten andererseits dominieren. Zweitens wurde untersucht, ob Studierende der Wirtschafts-, Sozial- und Ingenieurwissenschaften sich in ihrem Fairnessverhalten unter-scheiden. Durch den sequentiellen Aufbau des Experimentes können individuelle Unterschiede im Verhalten in beiden Spielen analysiert werden: Faires und unfaires Verhalten sind identifizierbar. Zur Unterscheidung von "fairem" und "unfairem" Verhalten werden dabei zwei ver-schiedene Definitionen herangezogen. Generell zeigt sich in dem Befragungsexperiment, dass echt faires Verhalten einerseits und unfaires bzw. strategisch faires Verhalten andererseits tendenziell gleich häufig auftreten. Unter der Voraussetzung, dass die Resultate extern valide sind, kann das neoklassische Modell des eigensüchtigen rationalen Verhaltens insoweit nur einen Teil individueller ökonomischer Entscheidungen erklären. Gleiches gilt aber auch für die Annahme einer Präferenz der Individuen für "Fairness". [...] |
| Abstract: | The present study examines the fairness behavior of students of various academic programs. For this purpose, 289 students from three different majors of the Ernst-Abbe-University Jena were faced with two decision situations. In this survey experi-ment, the students had to choose how much of 100 EUR they would leave to an unknown co-player. In the ultimatum game the co-players had a right to veto, while not in the dictator game. The aim was to determine, first, to what extent fairness, or altruistic behavior on the one hand or selfish behavior on the other hand dominate. Secondly, the experiment investigates whether students of economic, social and engineering sciences differ in their fairness behavior. The sequential structure of the experiment allows the analysis of individual differences of giving behavior in both games. To distinguish between "fair" and "unfair" giving behavior two different definitions are used. Overall the survey experiment reveals that really fair behavior on the one hand and unfair or strategic fairness on the other hand occur almost equally frequently. Assuming that the results are externally valid, the neoclassical model of selfish rational behavior cannot be completely discarded, but explains only part of individual economic decisions. [...] |
| Keywords: | Altruismus,Fairness,Homo Oeconomicus,Diktatorspiel,Ultimatum-spiel,Befragung,sequentielles Spiel,Studienfächer,Studienrichtungen,Altruism,Ultimatum Game,Dictator Game,Rational behavior,Survey,sequential game,academic programs,major |
| JEL: | A13 C91 C72 D01 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:fhjbwf:20151&r=all |
| By: | Andersson, Tommy; Ehlers, Lars; Svensson, Lars-Gunnar |
| Abstract: | This paper explores situations where tenants in public houses, in a specific neighborhood, are given the legislated right to buy the houses they live in or can choose to remain in their houses and pay the regulated rent. This type of legislation has been passed in many European countries in the last 30-35 years (the U.K. Housing Act 1980 is a leading example). The main objective with this type of legislation is to transfer the ownership of the houses from the public authority to the tenants. To achieve this goal, selling prices of the public houses are typically heavily subsidized. The legislating body then faces a tradeoff between achieving the goals of the legislation and allocating the houses efficiently. This paper investigates this specific tradeoff and identifies an allocation rule that is individually rational, equilibrium selecting, and group non-manipulable in a restricted preference domain that contains "almost all" preference profiles. In this restricted domain, the identified rule is the equilibrium selecting rule that transfers the maximum number of ownerships from the public authority to the tenants. This rule is preferred to the current U.K. system by both the existing tenants and the public authority. Finally, a dynamic process for finding the outcome of the identified rule, in a finite number of steps, is provided. |
| Keywords: | public housing,existing tenants,equilibrium,minimum equilibrium prices,maximum trade,group non-manipulability,dynamic price process |
| JEL: | C71 C78 D71 D78 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:wzbmbh:spii2015207&r=all |
| By: | Dirk Bergemann; Stephen Morris |
| Date: | 2015–09–21 |
| URL: | http://d.repec.org/n?u=RePEc:cla:levrem:786969000000001085&r=all |
| By: | Bos A.M.; Vermeulen A.J. (GSBE) |
| Abstract: | This paper examines the existence and characteristics of pure-strategy Nash equilibria in oligopoly models in which firms set both prices and quantities. Existence is proved for a broad and natural class of price-quantity games. With differentiated products, the equilibrium outcome is similar to that of a price-only model. With undifferentiated products and limited spillover demand, there are rationing equilibria in which combined production falls short of market demand. Moreover, there might again be an equilibrium reflecting the outcome of a price game. Competition in price and quantity may thus yield Bertrand outcomes under a variety of market conditions. |
| Keywords: | Microeconomic Policy: Formulation; Implementation; Evaluation; Market Structure, Firm Strategy, and Market Performance: General; |
| JEL: | D04 L10 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:unm:umagsb:2015018&r=all |
| By: | Claudia Brunnlieb (Institute of Social Medicine and Health Economics, Otto-von-Guericke University Magdeburg); Stephan Schosser (Faculty of Economics and Management, Otto-von-Guericke University Magdeburg); Bodo Vogt (Faculty of Economics and Management, Otto-von-Guericke University Magdeburg) |
| Abstract: | We delineated the causal influence of vasopressin on behavior in an iterated Hawk-Dove game. While subjects treated with vasopressin tend to be more aggressive in response to group members who did not coordinate on equilibrium instantaneously, this effect vanishes as soon as the subjects reach an equilibrium. More than vasopressin, social preferences and trait anxiety of the subjects predict the observed behavior. |
| Keywords: | Hawk-Dove game, anti-coordination game, neuroeconomic experiment, vasopressin, psychological aspects |
| JEL: | C72 C92 D03 D87 |
| Date: | 2015–07 |
| URL: | http://d.repec.org/n?u=RePEc:mag:wpaper:150012&r=all |
| By: | Wolfgang Luhan (Ruhr University Bochum); Anders Poulsen (University of East Anglia); Michael Roos (Ruhr University Bochum) |
| Abstract: | We report experimental data from a bargaining situation where two decision makers tacitly make their decisions, and earn and cumulate their payoffs in real time. Examples include fishermen choosing fishing spots, interaction among neighbors who prefer not to talk, military conflict, and tacit duopoly. The data can be organized and explained in terms of focal properties of feasible payoffs, and the complexity of coordinating on the intertemporal behavior required to achieve these payoffs. Bargainers trade off payoff focality and coordination complexity, and behavior can be systematically inefficient. |
| Keywords: | bargaining, real time interaction, payoff focality, coordination complexity, bounded rationality |
| JEL: | C70 C72 C92 |
| Date: | 2015–07–15 |
| URL: | http://d.repec.org/n?u=RePEc:uea:wcbess:15-11&r=all |
| By: | CHANITA PANMANEE (Faculty of Economics, Maejo University); ROENGCHAI TANSUCHAT (Faculty of Economics, Chiangmai University); AREE CHEAMUANGPHAN (Faculty of Economics, Maejo University); KASEM KUNASRI (Faculty of Management Sciences, Chiangmai Rajabhat University); NISACHON LEERATTANAKORN (Faculty of Economics, Maejo University) |
| Abstract: | Dried longan is one of economic product in the northern of Thailand. It does not only solve the excess supply problem of fresh longan, but increase employment opportunities. Currently, the environmental responsibility is the important issue in which both producers and consumers are interested. Dried longan production system, thus, changes from traditional system using extravagant energy to environmentally friendly system using green technology. However, the green products are accepted in some consumer groups. Consequently, this paper explores the best decision making on green or non-green oriented productions of the dried longan enterprises by applying the game theory. The selected samples are two dried longan enterprise clusters in Chiang Mai and Lamphun provinces for playing in this game. The results represent that the green production system is the best choice of producers. It brings about the high economic payoffs but low physical resource usage. However, the information is necessary for the consumers to perceive value of green consumption and increase demand of green products. This findings are obviously useful for the dried longan enterprises in Thailand to make a decision for changing their production from traditional to green orientation. |
| Keywords: | Dried longan enterprise clusters, Green production, Non-green production, Game theory |
| JEL: | C70 C79 C71 |
| URL: | http://d.repec.org/n?u=RePEc:sek:iacpro:2704735&r=all |
| By: | Todd Kaplan, Bradley Ruffle (Wilfrid Laurier University) |
| Abstract: | Cooperation between two players often requires exactly one to take the available action, while the other acquiesces. If the decisions whether to pursue the action are made simultaneously, then neither or both may acquiesce leading to an inefficient outcome. However, inefficiency may be avoided if players move sequentially. We test experimentally whether two-stage versions of this entry-exit game enhance cooperation. In one version, players may wait in the first stage to see what their paired player did and then coordinate in the second stage. In another version, sequential decision-making is imposed by assigning one player to move in stage one and the other player in stage two. Although there are fewer cooperative decisions in the two-stage treatments, we show that subjects coordinate better on efficient cooperation and on avoiding both acquiescing. Consequently they achieve higher profits. Yet, the least cooperative pairs do worse in the two-stage games than their single-stage counterparts. They use the second stage not to facilitate coordination but to disguise their uncooperative play or to punish their opponents. |
| Keywords: | experimental economics, cooperation, efficiency, two-stage games, turn-taking. |
| JEL: | C90 Z13 |
| Date: | 2015–09–16 |
| URL: | http://d.repec.org/n?u=RePEc:wlu:lcerpa:0095&r=all |
| By: | Kwiek, Maksymilian (University of Southampton); Marreiros, Helia (University of Southampton); Vlassopoulos, Michael (University of Southampton) |
| Abstract: | A conclave is a voting mechanism in which a committee selects an alternative by voting until a sufficient supermajority is reached. We study experimentally welfare properties of simple three-voter conclaves with privately known preferences over two outcomes and waiting costs. The resulting game is a form of multiplayer war of attrition. Our key finding is that, consistent with theoretical predictions, when voters are ex ante heterogeneous in terms of the intensity of their preferences the conclave leads to efficiency gains relative to simple majority voting. We also compare welfare properties of a static versus a dynamic version of a conclave. When social cost of waiting is taken into account, the dynamic conclave is superior in terms of welfare than its static version. |
| Keywords: | voting, supermajority, intensity of preferences, war of attrition |
| JEL: | C78 C92 D72 D74 |
| Date: | 2015–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp9336&r=all |
| By: | Schmid, Julia |
| Abstract: | One reason for firms to voluntarily increase their environmental or social production standards is to prevent consumers from lobbying for stricter mandatory standards. In this sense, voluntary overcompliance serves as a Greek gift, as consumers might be worse off in the end. Strategically, a Greek gift deteriorates the consumer's incentive for lobbying and, as such, might be unkind. In many experiments it was shown that unkind actions which decrease the other's payoff are punished by negative reciprocal behavior. This paper experimentally investigates whether negative reciprocity can also be observed if unkind behavior is not directed at payoffs but rather at a deterioration of strategic incentives. |
| Keywords: | experiments,voluntary agreements,overcompliance,learning,reciprocity |
| JEL: | C72 C92 D83 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:wzbmbh:spii2015206&r=all |
| By: | Peter A. Streufert (University of Western Ontario) |
| Abstract: | Osborne and Rubinstein (1994) specify each node in a game tree as a sequence of actions. It is well-known that such actions can be replaced by choices (i.e. agent-specific actions) without loss of generality. I find that this sequential formulation is redundant in the sense that nodes can be equivalently specified as sets of choices. The only cost of doing so is to rule out absent-mindedness. My analysis encompasses both ordered and unordered information sets and both finite and infinite horizons. (This specification of nodes as sets of choices differs from the literature's specification of nodes as sets of outcomes.) |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:uwo:uwowop:20151&r=all |
| By: | Michaeli, Moti |
| Abstract: | Group formation and in-group bias - preferential treatment for insiders - are widely observed social phenomena. This paper demonstrates how they arise naturally when people incur a psychological cost as the result of defecting when facing cooperators, when this cost is increasing and concave in the number of such defections. If some group members are asocial, i.e., insusceptible to that cost, then, under incomplete information, free-riding and cooperation can coexist within groups. Signaling of one's type can enable groups to screen out free-riders, but signalling is costly, and its availability may decrease the welfare of all the individuals in society. |
| Keywords: | In-Group Bias, Group Formation, Costly Signalling, Prisoner's Dilemma Game |
| JEL: | D7 D03 Z13 D64 D82 C72 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:eui:euiwps:mwp2015/04&r=all |
| By: | Martin A. Leroch (Institute of Political Science, Unit Politics and Economy, Johannes Gutenberg-Universitaet Mainz, Germany) |
| Abstract: | While classic bargaining theory abstracts from other-regarding motives, bargaining processes often take place among parties who care about each other's payo. In this paper, I analyze how other- regarding preferences aect the outcome, duration, and use of means to harm the other in reference to a Rubinstein bargain- ing game. It is found that agents regarding each other's payo negatively will reach less equal outcomes, take longer to reach this outcome and are more likely to harm each other if they have means available to do so. |
| Date: | 2015–09–15 |
| URL: | http://d.repec.org/n?u=RePEc:jgu:wpaper:1509&r=all |
| By: | Raouf Boucekkine (GREQAM, Aix Marseille University); Fabien Prieur (INRA and University of Montpellier); Benteng Zou (CREA, Université du Luxembourg) |
| Abstract: | We propose an analysis of institutional dynamics under uncertainty by the means of a stochastic differential lobbying game with two main ingredients. The first one is uncertainty inherent in the institutional process itself. The second one has to do with the crucial role of resource windfalls in economic and political outcomes, shaping lobbying power and adding a second source of uncertainty. First, we focus on uncertainty surrounding the institutional process only and show that its main consequence is the existence of multiple equilibria with very distinct features: symmetric equilibria which lead the economy to reach almost surely a stable pointwise institutional steady state in the long run even in the absence of the retaliation motive put forward by the deterministic lobbying literature, and asymmetric equilibria which only show up under uncertainty and do no allow for stochastic convergence to a steady state. Second, when accounting for the two sources of uncertainty together with resource revenue-dependent lobbying power, we show that revenue volatility tends to stabilize institutional dynamics compared to the deterministic counterpart. |
| Keywords: | institutional dynamics, lobbying games, state-dependent lobbying power, revenue volatility, stochastic differential games |
| JEL: | D72 C61 C63 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:luc:wpaper:15-08&r=all |
| By: | Dirk Bergemann; Stephen Morris |
| Date: | 2015–09–21 |
| URL: | http://d.repec.org/n?u=RePEc:cla:levrem:786969000000001070&r=all |
| By: | Yeon Koo Che; Olivier Tercieux |
| Date: | 2015–09–21 |
| URL: | http://d.repec.org/n?u=RePEc:cla:levrem:786969000000001059&r=all |
| By: | Arianna Degan (Université du Québec à Montréal and CIRPEE); Ming Li (Concordia University and CIREQ) |
| Abstract: | We present a model of persuasive signalling, where a privately-informed sender selects from a class of signals with different precision to persuade a receiver to take one of two actions, where higher precision is more costly. The sender’s information could be either favourable or unfavourable. The receiver observes both the sender’s choice of signal and a random realization of the signal. We show that all plausible equilibria must involve some pooling and any informative signal must be associated with an optimistic posterior. When the receiver is ex ante pessimistic or indifferent, the only plausible equilibrium is semi-separating, with levels of precision independent of the prior. Finally, we investigate the sender’s optimal persuasion policy–choice of signal before (commitment) or after (discretion) he learns his type. We show that the sender is indifferent between commitment and discretion when the prior is optimistic, prefers discretion to commitment when the prior is sufficiently pessimistic, and could either prefer discretion or commitment when the prior is neutral. |
| Keywords: | signalling, persuasion, divine equilibrium, optimal information provision. |
| JEL: | D72 D82 |
| Date: | 2015–08 |
| URL: | http://d.repec.org/n?u=RePEc:crd:wpaper:15003&r=all |
| By: | Yeon Koo Che; Olivier Tercieux |
| Date: | 2015–09–21 |
| URL: | http://d.repec.org/n?u=RePEc:cla:levrem:786969000000001049&r=all |
| By: | Stephan Schosser (Faculty of Economics and Management, Otto-von-Guericke University Magdeburg); Bodo Vogt (Faculty of Economics and Management, Otto-von-Guericke University Magdeburg) |
| Abstract: | This paper describes an experimental study involving the minimum effort game. In this game, each player faces a trade-off between risk and payoff. Within each group, half of the subjects were administered with vasopressin in nasal spray form while half received a placebo. We found that subjects who received vasopressin were more likely to play the minimally risky strategy in the group and less likely to focus on payoff levels than those who received the placebo. |
| Keywords: | minimum effort game; coordination game; neuroeconomic experiment; vasopressin |
| Date: | 2015–07 |
| URL: | http://d.repec.org/n?u=RePEc:mag:wpaper:150011&r=all |