Simonson and Tversky (Journal of Marketing Research, 1992) demonstrated that the tendency to choose an alternative is enhanced or hindered depending on whether the tradeoffs within the set under consideration are favorable or unfavorable to that option (tradeoff contrast effect). In this paper...

Experimental evidence suggests that people tend to be overconfident in the sense that they overestimate the accuracy of their own predictions. In this paper we present a simple principal-agent model in which principal's interest in dispersing risk motivates him to hire overconfident agents. We...

This paper studies extensive form games with perfect information and simultaneous moves, henceforth called games with public information. On this class, we prove that all communication equilibrium payoffs can be obtained without mediator by cheap-talk procedures. The result encompasses repeated...

Experimental evidence suggests that people tend to be overconfident in the sense that they overestimate the accuracy of their own predictions. In this paper we present a principal-agent model in which principal's interest in diversification motivates him to hire overconfident agents. We show...

Experimental evidence suggests that people tend to be overconfident in the sense that they overestimate the accuracy of their own predictions. In this paper we present a principal-agent model in which principal's interest in diversification motivates him to hire overconfident agents. We show...

We study population dynamics under which each revising agent tests each strategy k times, with each trial being against a newly drawn opponent, and chooses the strategy whose mean payoff was highest. When k = 1, defection is globally stable in the prisoner’s dilemma. By contrast, when k 1 we...

Experimental evidence suggests that people tend to be overconfident in the sense that they overestimate the accuracy of their own predictions. In this paper we present a principal-agent model in which principal's interest in diversification motivates him to hire overconfident agents. We show...

In many situations, such as trade in stock exchanges, agents have many instances to act even though the duration of interactions take a relatively short time. The agents in such situations can often coordinate their actions in advance, but coordination during the game consumes too much time. An...

We study population dynamics under which each revising agent tests each strategy k times, with each trial being against a newly drawn opponent, and chooses the strategy whose mean payoff was highest. When k = 1, defection is globally stable in the prisoner’s dilemma. By contrast, when k 1 we...

Experimental evidence suggest that people only use 1-3 iterations of strategic reasoning, and that some people systematically use less iterations than others. In this paper, we present a novel evolutionary foundation for these stylized facts. In our model, agents interact in finitely repeated...