The Effect of Sequentiality on Cooperation in Repeated Games

By Riccardo Ghidoni and Sigrid Suetens

American Economic Journal: Microeconomics, November 2022

Sequentiality of moves in an infinitely repeated prisoner's dilemma does not change the conditions under which mutual cooperation can be supported in equilibrium relative to simultaneous decision-making. The nature of the interaction is different, however...

Disclosure and Favoritism in Sequential Elimination Contests

By Qiang Fu and Zenan Wu

American Economic Journal: Microeconomics, November 2022

We consider a two-stage contest, in which only a subset of contestants enters the finale. We explore the optimal policy for disclosing contestants' interim status after the preliminary round, i.e., their interim ranking and elimination decision. The optim...

Games Played by Teams of Players

By Jeongbin Kim, Thomas R. Palfrey, and Jeffrey R. Zeidel

American Economic Journal: Microeconomics, November 2022

We develop a general framework for analyzing games where each player is a team and members of the same team all receive the same payoff. The framework combines noncooperative game theory with collective choice theory, and is developed for both strategic f...

Reaping the Informational Surplus in Bayesian Persuasion

By Ronen Gradwohl, Niklas Hahn, Martin Hoefer, and Rann Smorodinsky

American Economic Journal: Microeconomics, November 2022

The Bayesian persuasion model studies communication between an informed sender and a receiver with a payoff-relevant action, emphasizing the ability of a sender to extract maximal surplus from his informational advantage. In this paper, we study a setting...

Rational Inattention in the Infield

By Vivek Bhattacharya and Greg Howard

American Economic Journal: Microeconomics, November 2022

This paper provides evidence of rational inattention by experienced professionals in strategic interactions. We add rational inattention to a game of matching pennies with state-dependent payoffs. Unlike the full-information, mixed-strategy Nash equilibri...

Getting Permission

By Peicong Hu and Joel Sobel

American Economic Review: Insights, December 2022

A manager has access to expert advisers. The manager selects at most one project and can implement it only if one expert provides support. The game in which the manager consults experts simultaneously typically has multiple equilibria, including one in wh...

The Effects of Time Preferences on Cooperation: Experimental Evidence from Infinitely Repeated Games

By Jeongbin Kim

American Economic Journal: Microeconomics, February 2023

This paper studies the effects of time preferences on cooperation in an infinitely repeated prisoner's dilemma game experiment. Subjects play repeated games in the lab, all decisions at once, but stage game payoffs are paid over an extended period of time...

The Doors of Perception: Theory and Evidence of Frame-Dependent Rationalizability

By Gary Charness and Alessandro Sontuoso

American Economic Journal: Microeconomics, May 2023

We investigate how strategic behavior is affected by the set of notions (frames) used when thinking about the game. In our games the action set consists of visual objects: each player must privately choose one, trying to match the counterpart's choice. We...

Complementarities and Games: New Developments

By Xavier Vives

Journal of Economic Literature, June 2005

The theory of monotone comparative statics and supermodular games is presented as the appropriate tool to model complementarities. The approach, which has not yet been fully incorporated into the standard toolbox of researchers, makes the analysis intuiti...

Similarity Nash Equilibria in Statistical Games

By Rossella Argenziano and Itzhak Gilboa

American Economic Journal: Microeconomics, August 2023

A statistical game is a game in which strategic interaction is mediated via a binary outcome y, coupled with a prediction problem where a characteristic x of the game may be used to predict its outcome y based on past values of (x, y). In Similarity Nash ...

Bid Caps in Noisy Contests

By Qiang Fu, Zenan Wu, and Yuxuan Zhu

American Economic Journal: Microeconomics, August 2023

This paper studies optimal bid caps in a multiplayer noisy contest in which a higher bid does not guarantee a sure win. The bid cap can be either rigid or flexible. The former imposes outright bidding restrictions on players' bids, while the latter taxes ...

Using Team Discussions to Understand Behavior in Indefinitely Repeated Prisoner's Dilemma Games

By David J. Cooper and John H. Kagel

American Economic Journal: Microeconomics, November 2023

We compare behavior of two person teams with individuals in indefinitely repeated prisoner dilemma games with perfect monitoring. Team discussions are used to understand the rationale underlying these choices and how these choices come about. There are th...

Predicting Cooperation with Learning Models

By Drew Fudenberg and Gustav Karreskog Rehbinder

American Economic Journal: Microeconomics, February 2024

We use simulations of a simple learning model to predict cooperation rates in the experimental play of the indefinitely repeated prisoner's dilemma. We suppose that learning and the game parameters only influence play in the initial round of each supergam...

Multigame Contact: A Double-Edged Sword for Cooperation

By Vincent Laferrière, Joao Montez, Catherine Roux, and Christian Thöni

American Economic Journal: Microeconomics, May 2024

We study experimentally the effect of multigame contact on cooperation, with each subject playing a pair of indefinitely repeated prisoner's dilemmas. Multigame contact is present if a subject plays both games with a single partner, and it is absent if ea...

Explaining Diversity: Symmetry-Breaking in Complementarity Games

By Kiminori Matsuyama

American Economic Review, May 2002

Communicating about Confidence: Cheap Talk with an Ambiguity-Averse Receiver

By Philippe Colo

American Economic Journal: Microeconomics, August 2024

An expert, who is only informed of the probability of possible states, communicates with a decision-maker through cheap talk. The decision-maker considers different probability distributions over states as possible and is ambiguity averse. I show that all...

Intelligence Disclosure and Cooperation in Repeated Interactions

By Marco Lambrecht, Eugenio Proto, Aldo Rustichini, and Andis Sofianos

American Economic Journal: Microeconomics, August 2024

How does information about players' intelligence affect strategic behavior? Game theory, based on the assumption of common knowledge of rationality, does not provide useful predictions. We experimentally show that, in the Prisoner's Dilemma, disclosure ha...

Negotiating Cooperation under Uncertainty: Communication in Noisy, Indefinitely Repeated Interactions

By Fabian Dvorak and Sebastian Fehrler

American Economic Journal: Microeconomics, August 2024

Case studies of cartels and recent theory suggest that communication is a key factor for cooperation under imperfect monitoring, where actions can only be observed with noise. We conduct a laboratory experiment to study how communication affects cooperati...

Beliefs, Learning, and Personality in the Indefinitely Repeated Prisoner's Dilemma

By David Gill and Yaroslav Rosokha

American Economic Journal: Microeconomics, August 2024

We aim to understand the role and evolution of beliefs in the indefinitely repeated prisoner's dilemma (IRPD). To do so, we elicit beliefs about the supergame strategies chosen by others. We find heterogeneity in beliefs and changes in beliefs with experi...

Decentralized Matching with Transfers: Experimental and Noncooperative Analyses

By Simin He, Jiabin Wu, Hanzhe Zhang, and Xun Zhu

American Economic Journal: Microeconomics, November 2024

We experimentally examine the Becker-Shapley-Shubik two-sided matching model. In the experiment, the aggregate outcomes of matching and surplus are affected by whether equal split is in the core and whether efficient matching is assortative; the canonical...