Why do experimental subjects choose an equilibrium which is neither risk nor payoff dominant

In an experimental 2x2 coordination game with two strict equilibria we observe that, in contrast to equilibrium selection theory (Harsanyi and Selten 1988), only half of the subjects choose the strategy that relates to the payoff- and risk-dominant equilibrium. We propose modified risk dominance as an explanation for the observed deviations from payoff and risk dominance.

MoreLess

Authors:	Keser, Claudia ; Vogt, Bodo
Institutions:	Sonderforschungsbereich 504 "Rationalitätskonzepte, Entscheidungsverhalten und ökonomische Modellierung", Abteilung für Volkswirtschaftslehre ; Sonderforschungsbereich 504, University of Mannheim

More details

Extent:	application/pdf
Series:	Sonderforschungsbereich 504 Publications.
Type of publication:	Book / Working Paper
Language:	English
Notes:	We thank Roy Gardner and Werner Güth for their helpful comments. Financial support from the Deutsche Forschungsgemeinschaft, SFB 504, at the University of Mannheim, is gratefully acknowledged. Thanks are also due to the research group The text is part of a series sfbmaa Number 00-40 11 pages
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10005761161