Learning to bargain
AbstractThis paper studies how children learn to bargain. We performed simple anonymous bargaining experiments with real payoffs with 256 children from age 8 to 18. On average, offers by even the youngest children were close to optimal, given the responses. Both offers and responses were similar to the results that others have reported for adults. Younger children showed more variance in the size of proposals. Children showed clear evidence of reinforcement learning, responding to a rejection by increasing subsequent proposals. This pattern was strongest for the youngest children, who tended to over-react to rejections. We found mixed support for social cognitive theory: while proposals increased after other children made larger proposals, they did not increase after proposals by others were rejected.
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Bibliographic InfoArticle provided by Elsevier in its journal Journal of Economic Psychology.
Volume (Year): 28 (2007)
Issue (Month): 1 (January)
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Web page: http://www.elsevier.com/locate/joep
Other versions of this item:
- William T. Harbaugh & Kate Krause & Lise Vesterlund, 2003. "Learning to Bargain," University of Oregon Economics Department Working Papers 2004-9, University of Oregon Economics Department, revised 01 Nov 2003.
- D80 - Microeconomics - - Information, Knowledge, and Uncertainty - - - General
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