The impact of naive advice and observational learning in beauty-contest games
AbstractWe study the impact of advice or observation on the depth of reasoning in an experimental beauty-contest game. Both sources of information trigger faster convergence to the equilibrium. Yet, we find that subjects who receive naive advice outperform uninformed subjects permanently, whereas subjects who observe others' past behavior before making their decision do only have a temporary advantage over uninformed subjects. We show in a simulation that the latter result is due to subjects failing to make the most out of observing others.
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Bibliographic InfoPaper provided by Faculty of Economics and Statistics, University of Innsbruck in its series Working Papers with number 2007-01.
Length: 37 pages
Date of creation: Jan 2007
Date of revision:
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Web page: http://www.uibk.ac.at/fakultaeten/volkswirtschaft_und_statistik/index.html.en
More information through EDIRC
social learning; advice; observational learning; beauty-contest game;
Other versions of this item:
- Martin G. Kocher & Matthias Sutter & Florian Wakolbinger, 2007. "The Impact of Na�ve Advice and Observational Learning in Beauty-contest Games," Tinbergen Institute Discussion Papers 07-015/1, Tinbergen Institute.
- C70 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - General
- C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
- C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior
This paper has been announced in the following NEP Reports:
- NEP-ALL-2007-03-03 (All new papers)
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.:
- Ananish Chaudhuri & Sara Graziano & Pushkar Maitra, 2006. "Social Learning and Norms in a Public Goods Experiment with Inter-Generational Advice -super-1," Review of Economic Studies, Oxford University Press, vol. 73(2), pages 357-380.
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"One, two, (three), infinity: Newspaper and lab beauty-contest experiments,"
Economics Working Papers
438, Department of Economics and Business, Universitat Pompeu Fabra.
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- Antoni Bosch-Dom?nech & Jose Garcia-Montalvo & Rosemarie Nagel & Albert Satorra, 2002. "One, two, (three), infinity: Newspaper and lab beauty-contest experiments," Artefactual Field Experiments 00011, The Field Experiments Website.
- Camerer, Colin F. & Ho, Teck-Hua & Chong, Juin-Kuan, 2002. "Sophisticated Experience-Weighted Attraction Learning and Strategic Teaching in Repeated Games," Journal of Economic Theory, Elsevier, vol. 104(1), pages 137-188, May.
- Colin Camerer & Teck Ho & Kuan Chong, 2003. "Models of Thinking, Learning, and Teaching in Games," American Economic Review, American Economic Association, vol. 93(2), pages 192-195, May.
- Joep Sonnemans & Jan Tuinstra, 2008.
"Positive Expectations Feedback Experiments and Number Guessing Games as Models of Financial Markets,"
Tinbergen Institute Discussion Papers
08-076/1, Tinbergen Institute.
- Sonnemans, Joep & Tuinstra, Jan, 2010. "Positive expectations feedback experiments and number guessing games as models of financial markets," Journal of Economic Psychology, Elsevier, vol. 31(6), pages 964-984, December.
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