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Level-k reasoning and time pressure in the 11–20 money request game

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  • Lindner, Florian
  • Sutter, Matthias

Abstract

Arad and Rubinstein (2012a) have designed a novel game to study level-k reasoning experimentally. Just like them, we find that the depth of reasoning is very limited and clearly different from that in equilibrium play. We show that such behavior is even robust to repetitions; hence there is, at best, little learning. However, under time pressure, behavior is, perhaps coincidentally, closer to that in equilibrium play. We argue that time pressure evokes intuitive reasoning and reduces the focal attraction of choosing higher (and per se more profitable) numbers in the game.

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Bibliographic Info

Article provided by Elsevier in its journal Economics Letters.

Volume (Year): 120 (2013)
Issue (Month): 3 ()
Pages: 542-545

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Handle: RePEc:eee:ecolet:v:120:y:2013:i:3:p:542-545

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Web page: http://www.elsevier.com/locate/ecolet

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Keywords: Level-k reasoning; Time pressure; Repetition; Experiment;

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Cited by:
  1. Florian Lindner, 2013. "Decision time and steps of reasoning in a competitive market entry game," Working Papers 2013-19, Faculty of Economics and Statistics, University of Innsbruck.
  2. Choo, Lawrence C.Y & Kaplan, Todd R., 2014. "Explaining Behavior in the "11-20" Game," MPRA Paper 52808, University Library of Munich, Germany.
  3. Benndorf, Volker & Kübler, Dorothea & Normann, Hans-Theo, 2013. "Privacy concerns, voluntary disclosure of information, and unraveling: An experiment," Discussion Papers, Research Unit: Market Behavior SP II 2013-208, Social Science Research Center Berlin (WZB).

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