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Words, Deeds and Lies: Strategic Behavior in Games with Multiple Signals

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Author Info
Nick Feltovich () (Department of Economics, University of Houston)
John Duffy () (Department of Economics, University of Pittsburgh)

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Abstract

We report the results of an experiment in which subjects play games repeatedly against changing opponents. In one treatment, "senders" send messages to "receivers" indicating intended actions in that round, and receivers observe senders' previous-round actions (when matched with another receiver). In another treatment, the receiver additionally observes the sender's previous-round message to the previous opponent, enabling him to determine whether the sender lied in the previous round. We find that allowing more than one signal leads to better outcomes when signals are aligned (all pointing to the same action), but worse outcomes when signals are crossed. We also find that senders' signals tend to be truthful, though the degree of truthfulness depends on the game and treatment, and receivers' behavior combines elements of payoff maximization and reciprocity.

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Publisher Info
Paper provided by Department of Economics, University of Houston in its series Working Papers with number 2004-01.

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Length: 21 pages
Date of creation: Sep 2004
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Handle: RePEc:hou:wpaper:2004-01

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Postal: Houston TX 77023
Web page: http://www.uh.edu/academics/sos/econ/
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Related research
Keywords: observation; cheap talk; truthfulness; deception;

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Find related papers by JEL classification:
D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search, Learning, and Information
C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
C73 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Stochastic and Dynamic Games; Evolutionary Games

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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.:
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  5. Russell Cooper & Douglas V. DeJong & Robert Forsythe & Thomas W. Ross, 1989. "Communication in the Battle of the Sexes Game: Some Experimental Results," RAND Journal of Economics, The RAND Corporation, vol. 20(4), pages 568-587, Winter. [Downloadable!] (restricted)
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  8. Farrell, Joseph & Rabin, Matthew, 1996. "Cheap Talk," Journal of Economic Perspectives, American Economic Association, vol. 10(3), pages 103-18, Summer. [Downloadable!] (restricted)
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  12. Nick Feltovich & John Duffy, 1999. "Does observation of others affect learning in strategic environments? An experimental study," International Journal of Game Theory, Springer, vol. 28(1), pages 131-152. [Downloadable!] (restricted)
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  13. Nick Feltovich, 2003. "Nonparametric Tests of Differences in Medians: Comparison of the Wilcoxon–Mann–Whitney and Robust Rank-Order Tests," Experimental Economics, Springer, vol. 6(3), pages 273-297, November. [Downloadable!] (restricted)
  14. Huck, Steffen & Normann, Hans-Theo & Oechssler, Jorg, 1999. "Learning in Cournot Oligopoly--An Experiment," Economic Journal, Royal Economic Society, vol. 109(454), pages C80-95, March. [Downloadable!] (restricted)
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  15. Okuno-Fujiwara Masahiro & Postlewaite Andrew, 1995. "Social Norms and Random Matching Games," Games and Economic Behavior, Elsevier, vol. 9(1), pages 79-109, April. [Downloadable!] (restricted)
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Full references

Cited by:
(explanations, 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.)

  1. Giovanna Devetag & Andreas Ortmann, 2007. "When and why? A critical survey on coordination failure in the laboratory," Experimental Economics, Springer, vol. 10(3), pages 331-344, September. [Downloadable!] (restricted)
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  2. Huck, Steffen & Ruchala, Gabriele K. & Tyran, Jean-Robert, 2006. "Competition Fosters Trust," CEPR Discussion Papers 6009, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
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  3. Luca Anderlini & Dino Gerardi & Roger Lagunoff, 2007. "Social Memory and Evidence from the Past," Cowles Foundation Discussion Papers 1601, Cowles Foundation, Yale University. [Downloadable!]
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  4. Michele Belot, & V. Bhaskar & Jeroen van de Ven, 2006. "A Public Dilemma: Cooperation with Large Stakes and a Large Audience," Economics Discussion Papers 617, University of Essex, Department of Economics. [Downloadable!]
  5. Quazi Shahriar & Subhasish Dugar, 2009. "Focal Points and Economic Efficiency: Role of Relative Label Salience," Working Papers 0033, San Diego State University, Department of Economics. [Downloadable!]
  6. Francesco Feri & Bernd Irlenbusch & Matthias Sutter, 2009. "Efficiency Gains from Team-Based Coordination – Large-Scale Experimental Evidence," Working Paper Series of the Max Planck Institute for Research on Collective Goods 2009_14, Max Planck Institute for Research on Collective Goods. [Downloadable!]
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  7. Topi Miettinen, 2006. "Promises and Conventions - An Approach to Pre-play Agreements," Papers on Strategic Interaction 2006-29, Max Planck Institute of Economics, Strategic Interaction Group. [Downloadable!]
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