Equilibrium play and best response to (stated) beliefs in normal form games

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49 Citations (Scopus)

Abstract

We report experimental results on a series of ten one-shot two-person 3 × 3 normal form games with unique equilibrium in pure strategies played by non-economists. In contrast to previous experiments in which game theory predictions fail dramatically, a majority of actions taken coincided with the equilibrium prediction (70.2%) and were best-responses to subjects' stated beliefs (67.2%). In constant-sum games, 78% of actions taken were predicted by the equilibrium model, outperforming simple K-level reasoning models. We discuss how non-trivial game characteristics related to risk aversion, efficiency concerns and social preferences may affect the predictive value of different models in simple normal form games.

Original languageEnglish
Pages (from-to)572-585
Number of pages14
JournalGames and Economic Behavior
Volume65
Issue number2
DOIs
Publication statusPublished - Mar 2009
Externally publishedYes

Keywords

  • Constant sum games
  • Experiments
  • K-level reasoning
  • Normal form games
  • Stated beliefs

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