The risk-neutral equilibrium bidding strategy for first-price auctions with independent private values is justified without assuming a well-defined Bayesian game. Bidders, aware of their own value, assume the private values to be linearly related. The latter, however, are independent and...

We justify risk neutral equilibrium bidding in commonly known fair division games with incompleteinformation by an evolutionary setup postulating (i) minimal common knowledge, (ii) optimal responses to conjectural beliefs how others behave and (iii) evolutionary selection of conjectural beliefs...

We experimentally study a class of pie-sharing games with alternating roles in which the second (and final) stage of interaction follows the rules of a private impunity game, and occurs with a certain probability only if a first-stage agreement is not reached. A large number of participants play...

Bidding challenges learning theories, since with the same bid, experiences vary stochastically: the same choice can result in either a gain or a loss. In such an environment the question arises how the nearly universally documented phenomenon of loss aversion affects the adaptive dynamics. We...