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Cycles of aggregate behavior in theory and experiment


Bosch-Doménech, Antoni; Sáez-Martí, María (2001). Cycles of aggregate behavior in theory and experiment. Games and Economic Behavior, 36(2):105-137.

Abstract

We test in the laboratory the potential of evolutionary dynamics as predictor of actual behavior. To this end, we propose an asymmetric game (which we interpret as a borrower–lender relation), we study its evolutionary dynamics in a random matching setup, and we test its predictions. The theoretical model provides conditions for changes in qualitative aggregate behavior in response to variations in structural parameters. While it turns out that Nash equilibrium is not a reliable predictor of average aggregate behavior, the experiment seems to confirm the qualitative predictions of the evolutionary model under structural changes. Journal of Economic Literature Classification Numbers: C7, C9, E3.

Abstract

We test in the laboratory the potential of evolutionary dynamics as predictor of actual behavior. To this end, we propose an asymmetric game (which we interpret as a borrower–lender relation), we study its evolutionary dynamics in a random matching setup, and we test its predictions. The theoretical model provides conditions for changes in qualitative aggregate behavior in response to variations in structural parameters. While it turns out that Nash equilibrium is not a reliable predictor of average aggregate behavior, the experiment seems to confirm the qualitative predictions of the evolutionary model under structural changes. Journal of Economic Literature Classification Numbers: C7, C9, E3.

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Item Type:Journal Article, refereed, original work
Communities & Collections:03 Faculty of Economics > Department of Economics
Dewey Decimal Classification:330 Economics
Uncontrolled Keywords:Cycles, evolutionary dynamics, games, experiments
Language:English
Date:August 2001
Deposited On:20 May 2015 12:40
Last Modified:05 Apr 2016 19:15
Publisher:Elsevier
ISSN:0899-8256
Publisher DOI:https://doi.org/10.1006/game.2000.0821

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