Teaching Nash Equilibrium and Dominance: A Classroom Experiment on the Beauty Contest
AbstractThe aim of this investigation is to show how the use of classroom experiments may be a good pedagogical tool to teach the Nash equilibrium (NE) concept. For our purposes, the basic game is a repeated version of the Beauty Contest Game (BCG), a simple guessing game in which repetition lets students react to other players’ choices and converge iteratively to the equilibrium solution. We perform this experiment with undergraduate students with no previous training in game theory. After four rounds, we observe a clear decreasing tendency in the average submitted number in all groups. Thus, our findings prove that by playing a repeated BCG, students quickly learn how to reach the NE solution.
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Bibliographic InfoPaper provided by Institute for Social Syudies of Andalusia - Higher Council for Scientific Research in its series IESA Working Papers Series with number 0413.
Length: 40 pages
Date of creation: 2004
Date of revision:
Classroom Experiments; Beauty Contest Game; Teaching; Nash Equilibrium;
Other versions of this item:
- Virtudes Alba Fernández & Pablo Brañas Garza & Francisca Jiménez Jiménez & Javier Rodero Cosano, 2003. "Teaching Nash Equilibrium and Strategy Dominance: A Classroom Experiment on the Beauty Contest," Economic Working Papers at Centro de Estudios Andaluces E2003/47, Centro de Estudios Andaluces.
- A22 - General Economics and Teaching - - Economic Education and Teaching of Economics - - - Undergraduate
- C99 - Mathematical and Quantitative Methods - - Design of Experiments - - - Other
- D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search, Learning, and Information
This paper has been announced in the following NEP Reports:
- NEP-HPE-2004-09-12 (History & Philosophy of Economics)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Shinichi Hirota & Shyam Sunder, 2002.
"Stock Market as a 'Beauty Contest': Investor Beliefs and Price Bubbles sans Dividend Anchors,"
Yale School of Management Working Papers
ysm2, Yale School of Management.
- Shinichi Hirota & Shyam NMI Sunder, 2002. "Stock Market as a 'Beauty Contest': Investor Beliefs and Price Bubbles sans Dividend Anchors," Yale School of Management Working Papers ysm271, Yale School of Management.
- Duffy, John & Nagel, Rosemarie, 1997. "On the Robustness of Behaviour in Experimental "Beauty Contest" Games," Economic Journal, Royal Economic Society, vol. 107(445), pages 1684-1700, November.
- Brit Grosskopf & Rosemarie Nagel, 2007. "Rational reasoning or adaptive behavior? Evidence from two-person beauty contest games," Economics Working Papers 1068, Department of Economics and Business, Universitat Pompeu Fabra.
- Virtudes Alba-Fernández & Pablo Brañas-Garza & Francisca Jiménez-Jiménez & Javier Rodero-Cosano, 2004.
"Communication, coordination and competition in the beauty contest game: Eleven classroom experiments,"
IESA Working Papers Series
0416, Institute for Social Syudies of Andalusia - Higher Council for Scientific Research.
- Virtudes Alba Fernández & Pablo Brañas-Garza & Francisca Jiménez Jiménez & Javier Rodero Cosano, 2004. "Communication, coordination and competition in the beauty contest game: Eleven classroom experiments," ThE Papers 04/-1, Department of Economic Theory and Economic History of the University of Granada..
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