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A unified approach to comparative statics puzzles in experiments


Schmutzler, Armin (2008). A unified approach to comparative statics puzzles in experiments. Working paper series / Socioeconomic Institute No. 601, University of Zurich.

Abstract

Many experimental studies implement two versions of one game for which agents’ behavior is fundamentally different even though the Nash prediction is the same. This paper provides a novel explanation of such findings. Starting from the observation that many of the games under consideration satisfy the strategic-complementarity property, I obtain predictions for the direction of adjustment in response to parameter changes which do not require calculation of the quilibrium. I show that these predictions explain the experimental evidence very well. Further, I provide a behavioral justification of the approach, and I explore the relation to alternative explanations based on equilibrium selection theories and the quantal response equilibrium.

Abstract

Many experimental studies implement two versions of one game for which agents’ behavior is fundamentally different even though the Nash prediction is the same. This paper provides a novel explanation of such findings. Starting from the observation that many of the games under consideration satisfy the strategic-complementarity property, I obtain predictions for the direction of adjustment in response to parameter changes which do not require calculation of the quilibrium. I show that these predictions explain the experimental evidence very well. Further, I provide a behavioral justification of the approach, and I explore the relation to alternative explanations based on equilibrium selection theories and the quantal response equilibrium.

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Additional indexing

Item Type:Working Paper
Communities & Collections:03 Faculty of Economics > Department of Economics
Working Paper Series > Socioeconomic Institute (former)
Dewey Decimal Classification:330 Economics
JEL Classification:C70, C91
Language:English
Date:November 2008
Deposited On:29 Nov 2011 22:47
Last Modified:07 Dec 2017 10:17
Series Name:Working paper series / Socioeconomic Institute
Official URL:http://www.econ.uzh.ch/wp.html

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