Using or Hiding Private Information? An Experimental Study of Zero-Sum Repeated Games with Incomplete Information
AbstractThis paper studies the value of private information in strictly competitive interactions in which there is a trade-off between (i) the short-run gain of using information, and (ii) the long-run gain of concealing it. We implement simple examples from the class of zero-sum repeated games with incomplete information. While the empirical value of information does not always coincide with the theoretical prediction, the qualitative properties of the value of information are satisfied in the laboratory: (i) it is never negative, (ii) it decreases with the number of repetitions, (iii) it is bounded below by the value of the infinitely repeated game, and (iv) it is bounded above by the value of the one-shot game. In line with the theory, the empirical use of private information is almost complete when it should be, and decreases in longer interactions.
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Bibliographic InfoPaper provided by HAL in its series Post-Print with number halshs-00773412.
Date of creation: Mar 2013
Date of revision:
Publication status: Published, Games and Economic Behavior, 2013, 78, 103-120
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Concealment of information ; Laboratory experiments ; Value of information ; Zero-sum repeated games;
Other versions of this item:
- Jacquemet, Nicolas & Koessler, Frédéric, 2013. "Using or hiding private information? An experimental study of zero-sum repeated games with incomplete information," Games and Economic Behavior, Elsevier, vol. 78(C), pages 103-120.
- Nicolas Jacquemet & Frédéric Koessler, 2011. "Using or Hiding Private Information ? An experimental Study of Zero-Sum Repeated Games with Incomplete Information," Documents de travail du Centre d'Economie de la Sorbonne 11002, Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne.
- Nicolas Jacquemet & Frédéric Koessler, 2011. "Using or Hiding Private Information ? An Experimental Study of Zero-Sum Repeated Games with Incomplete Information," UniversitÃ© Paris1 PanthÃ©on-Sorbonne (Post-Print and Working Papers) halshs-00565157, HAL.
- C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
- D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
This paper has been announced in the following NEP Reports:
- NEP-ALL-2013-02-03 (All new papers)
- NEP-CDM-2013-02-03 (Collective Decision-Making)
- NEP-CTA-2013-02-03 (Contract Theory & Applications)
- NEP-EXP-2013-02-03 (Experimental Economics)
- NEP-GTH-2013-02-03 (Game Theory)
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