We ran three-round sequential bargaining experiments in which the perfect equilibrium offer was $1.25 and an equal split was $2.50. Subjects offered $2.11 to other subjects, $1.84 to "robot" players (who are known to play subgame perfectly), and $1.22 to robots after instruction in backward...

This essay is about what behavioral economics has established, what the new research frontiers are, and what can be said about welfare and consequently about policy.

The article considers the possibility that asset prices might deviate from intrinsic values based on market fundamentals. Three broad categories of theory are surveyed: (1) growing bubbles, (2) fads, and (3) information bubbles. "Sunspot" theories are also discussed. The paper covers both theory...

In 'experience-weighted attraction' (EWA) learning, strategies have attractions which reflect initial predispositions, are updated based on payoff experience, and determine choice probabilities according to some rule (e.g., logit). EWA includes reinforcement learning and weighted fictitious play...

The authors find that subjects' behavior in an incomplete-information, repeated-game experiment is roughly a sequent ial equilibrium. The deviations from sequential equilibrium can be ex plained by the existence of a "homemade prior" probability (about 1 7 percent) that players will cooperate...