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This paper presents a dynamic model in which agents adjust their decisions in the direction of higher payoffs, subject to random error. This process produces a probability distribution of players' decisions whose evolution over time is determined by the Fokker-Planck equation. The dynamic...
Persistent link: https://www.econbiz.de/10005626720
This paper reports data for coordination game experiments with random matching. The experimental design is based on changes in an effort-cost parameter, which do not alter the set of Nash equilibria, nor do they alter the predictions of dynamic adjustment theories based on imitation or best...
Persistent link: https://www.econbiz.de/10005801988
An increase in the common marginal value of a public good has two effects: it increases the benefit of a contribution to others, and it reduces the net cost of making a contribution. These two effects can be decomposed by letting a contribution have an "internal" return for oneself that differs...
Persistent link: https://www.econbiz.de/10005802005
This paper characterizes behavior with "noisy" decision making for a general class of N-person, binary-choice games. Applications include: participation games, voting, market entry, binary step-level public goods games, the volunteer's dilemma, the El Farol problem, etc. A simple graphical...
Persistent link: https://www.econbiz.de/10005802015
In two-stage bargaining games with alternating offers, the amount of the pie that remains after a rejection is what the first player should offer to the second player, since the second player can capture this remainder in the final (ultimatum) stage. Fairness considerations will reduce the...
Persistent link: https://www.econbiz.de/10005802018
Recent theoretical advances have dramatically increased the relevance of game theory for predicting human behavior in interactive situation. By relaxing the assumptions of perfect rationality and perfect foresight, we obtain much improved explanations of (i) initial decisions (ii)dynamic...
Persistent link: https://www.econbiz.de/10005750334