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A laboratory experiment on the minority game

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  • Bottazzi, Giulio
  • Devetag, Giovanna

Abstract

This work presents experimental results on a coordination game in which agents must repeatedly choose between two sides, and a positive fixed payoff is assigned only to agents who pick the minoritarian side. We conduct laboratory experiments in which stationary groups of five players play the game for 100 periods, and manipulate two treatment variables: the amount of ‘memory’ M that players have regarding the game history (i.e., the length of the string of past outcomes that players can see on the screen while choosing) and the amount of information about other players’ past choices. Our results show that, at the aggregate level, a quite remarkable degree of coordination is achieved. Moreover, providing players with full information about other players’ choice distribution does not appear to improve efficiency significantly.

Suggested Citation

  • Bottazzi, Giulio & Devetag, Giovanna, 2003. "A laboratory experiment on the minority game," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 324(1), pages 124-132.
    • Handle: RePEc:eee:phsmap:v:324:y:2003:i:1:p:124-132
    DOI: 10.1016/S0378-4371(02)01893-9
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    References listed on IDEAS

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    1. Jack Ochs, 1990. "The Coordination Problem in Decentralized Markets: An Experiment," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 105(2), pages 545-559.
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    Cited by:

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    3. Linde, Jona & Sonnemans, Joep & Tuinstra, Jan, 2014. "Strategies and evolution in the minority game: A multi-round strategy experiment," Games and Economic Behavior, Elsevier, vol. 86(C), pages 77-95.
    4. Kirman, Alan P. & Laisney, François & Pezanis-Christou, Paul, 2018. "Exploration vs exploitation, impulse balance equilibrium, and a specification test for the El Farol bar problem," ZEW Discussion Papers 18-038, ZEW - Leibniz Centre for European Economic Research.
    5. Michael E Roberts & Robert L Goldstone, 2011. "Adaptive Group Coordination and Role Differentiation," PLOS ONE, Public Library of Science, vol. 6(7), pages 1-8, July.
    6. Dindo, P.D.E. & Tuinstra, J., 2006. "A Behavioral Model for Participation Games with Negative Feedback," CeNDEF Working Papers 06-10, Universiteit van Amsterdam, Center for Nonlinear Dynamics in Economics and Finance.
    7. Nadir Altinok & Abdurrahman Aydemir, 2015. "The Unfolding of Gender Gap in Education," Working Papers 934, Economic Research Forum, revised Aug 2015.

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