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on Game Theory |
| By: | Liu, Tianwei |
| Abstract: | In interactions under strategic complementarity, naive players have a disproportionally large effect on the aggregate outcome, resulting in a nonlinear relationship between the proportion of sophisticated and naive players and the aggregate outcome. This paper studies this relationship in a beauty contest game by informing some players the game theoretic solution and systematically varying the proportion of informed players. The results show that the conditions predicted by strategic complementarity stand empirical test. |
| Keywords: | Beauty contest, Strategic complementarity, Beliefs, Bounded rationality |
| JEL: | C72 D03 D8 |
| Date: | 2016–11–10 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:75001&r=gth |
| By: | Banchongsan Charoensook (Keimyung Adams College, Keimyung University) |
| Abstract: | This paper studies a noncooperative model of network formation. Built upon the two-way flow model of Bala and Goyal (2000a), it assumes that information decay as it flows through each agent, and the decay is increasing and concave in the number of his links. This assumption results in the fact that a large set of Nash networks are disconnected and consist of components of different sizes, a feature that resembles that of real-world networks. Discussions on this insight are provided. |
| Keywords: | Two-way Flow Network, Network Formation, Information Network |
| JEL: | C72 D85 |
| Date: | 2016–11 |
| URL: | http://d.repec.org/n?u=RePEc:fem:femwpa:2016.65&r=gth |
| By: | Burka, Dávid; Puppe, Clemens; Szepesváry, László; Tasnádi, Attila |
| Abstract: | Can neural networks learn to select an alternative based on a systematic aggregation of convicting individual preferences (i.e. a 'voting rule')? And if so, which voting rule best describes their behavior? We show that a prominent neural network can be trained to respect two fundamental principles of voting theory, the unanimity principle and the Pareto property. Building on this positive result, we train the neural network on profiles of ballots possessing a Condorcet winner, a unique Borda winner, and a unique plurality winner, respectively. We investigate which social outcome the trained neural network chooses, and find that among a number of popular voting rules its behavior mimics most closely the Borda rule. Indeed, the neural network chooses the Borda winner most often, no matter on which voting rule it was trained. Neural networks thus seem to give a surprisingly clear-cut answer to one of the most fundamental and controversial problems in voting theory: the determination of the most salient election method. |
| Keywords: | voting, social choice, neural networks, machine learning, Borda count |
| JEL: | D71 |
| Date: | 2016–10–31 |
| URL: | http://d.repec.org/n?u=RePEc:cvh:coecwp:2016/13&r=gth |
| By: | Kamei, Kenju |
| Abstract: | A large volume of theoretical and experimental studies have suggested that making information on people’s past behaviors visible to others may lead to the evolution of cooperation in finitely-repeated environments. But, do people endogenously cooperate with randomly-matched peers by revealing their past when they have an option to hide it? This paper experimentally shows that cooperation does not evolve in a random-matching environment because a large fraction of people do not choose to reveal their past behavior. However, when a costly sorting mechanism (where disclosers are matched with other disclosers; and likewise non-disclosers with other non-disclosers) is present, a stable number of subjects decide to costly disclose their past to join the reputation community and cooperate with other disclosers. Our study at the same time shows that when the sorting process is free, the high efficiency in the reputation community decreases as strategic subjects tend to join the reputation community and attempt to exploit cooperators. These findings suggest an important role of costly sorting mechanisms in the formation of communities (including online platforms) in order for people to sustain a high level of cooperation norms. |
| Keywords: | experiment, cooperation, finitely-repeated dilemma, repeated games, reputation |
| JEL: | C73 C9 D0 H41 |
| Date: | 2016–09–25 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:75100&r=gth |
| By: | Puppe, Clemens |
| Abstract: | It is proved that, among all restricted preference domains that guarantee consistency (i.e. transitivity) of pairwise majority voting, the single-peaked domain is the only minimally rich and connected domain that contains two completely reversed strict preference orders. It is argued that this result explains the predominant role of single-peakedness as a domain restriction in models of political economy and elsewhere. The main result has a number of corollaries, among them a dual characterization of the single-dipped do- main; it also implies that a single-crossing ('order-restricted') domain can be minimally rich only if it is a subdomain of a single-peaked domain. The conclusions are robust as the results apply both to domains of strict and of weak preference orders, respectively. |
| Keywords: | social choice,restricted domains,Condorcet domains,single-peakedness,single-dippedness,majority voting,single-crossing property |
| JEL: | D71 C72 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:kitwps:97&r=gth |
| By: | Charoensook, Banchongsan |
| Abstract: | This paper studies a noncooperative model of network formation. Built upon the two-way flow model of Bala and Goyal (2000a), it assumes that information decay as it flows through each agent, and the decay is increasing and concave in the number of his links. This assumption results in the fact that a large set of Nash networks are disconnected and consist of components of different sizes, a feature that resembles that of real-world networks. Discussions on this insight are provided. |
| Keywords: | Two-way Flow Network, Network Formation, Information Network, Research and Development/Tech Change/Emerging Technologies, C72, D85, |
| Date: | 2016–11–04 |
| URL: | http://d.repec.org/n?u=RePEc:ags:feemet:249353&r=gth |
| By: | Somayeh Koohborfardhaghighi (College of Engineering, Seoul National University); Jorn Altmann (College of Engineering, Seoul National University) |
| Abstract: | Person-to-person interactions within an organization form a network of people. Changes of the structural properties of these networks are caused through a variety of dynamic processes among the people. We argue in this paper that there is a feedback loop between individual actions and the network structure. Therefore, a proper interaction model is needed to explain the emerging structural changes among networked individuals. According to our proposed interaction model, which is based on a complex adaptive system approach, changes in the network properties are consequences of four factors: (1) the initial underlying network structures; (2) the process of network growth; (3) the adoption of strategic responses to what other individuals do in the network; and (4) the network visibility. The experimental results show that all of these factors have influence. If the process of network growth triggers strategic responses of all direct neighbors, we observe a heavy drop in the average shortest path length between the individuals. The value of the average shortest path length shrinks to three, even independently of the visibility of the global network topology. We observe the same trend for the clustering coefficient. Fluctuations in the clustering coefficients are not significant, if visibility of the network topology is set to a high value. However, in the presence of only small number of strategic responses and a high network visibility, a short average shortest path length and a high clustering coefficient can be observed. |
| Keywords: | Co-Author Model; Strategic Behavior; Utility Maximization; Network Growth Models; Complex Adaptive System Approach; Agent-based Modeling and Simulation. |
| JEL: | A13 C02 C15 C63 C73 D85 |
| Date: | 2016–08 |
| URL: | http://d.repec.org/n?u=RePEc:snv:dp2009:2016130&r=gth |
| By: | Subhasish M. Chowdhury (University of East Anglia); Sang-Hyun Kim (University of East Anglia) |
| Abstract: | We reconsider whether a grand multi-winner contest elicits more equilibrium e ort than a collection of sub-contests. Fu and Lu (2009) employ a sequential winner- selection mechanism and nd support for running a grand contest. We show that this result is completely reversed if a simultaneous winner-selection mechanism or a sequential loser-elimination mechanism is implemented. We then discuss the optimal allocation of players and prizes among sub-contests, and the case in which there is restriction in the number of sub-contests. |
| Keywords: | Contest design; Multiple winner; Group-size; Selection mechanism |
| JEL: | C72 D72 D74 |
| Date: | 2016–11 |
| URL: | http://d.repec.org/n?u=RePEc:yon:wpaper:2016rwp-98&r=gth |