Equilibrium Selection under Limited Control - An Experimental Study of the Network Hawk-Dove Game
AbstractFor games of simultaneous action selection and network formation, game-theoretic behavior and experimental observations are not in line: While theory typically predicts inefficient outcomes for (anti-)coordination games, experiments show that subjects tend to play efficient (non Nash) strategy profiles. A reason for this discrepancy is the tendency to model corresponding games as one-shot and derive predictions. In this paper, we calculate the equilibria for a finitely repeated version of the Hawk-Dove game with endogenous network formation and show that the repetition leads to additional equilibria, namely the efficient ones played by human subjects. We confirm our results by an experimental study. In addition, we show both theoretically and experimentally that the equilibria reached crucially depend on the order in which subjects adjust their strategy. Subjects only reach efficient outcomes if they first adapt their action and then their network. If they choose their network first, they do not reach efficient outcomes.
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Bibliographic InfoPaper provided by Friedrich-Schiller-University Jena, Max-Planck-Institute of Economics in its series Jena Economic Research Papers with number 2013-048.
Date of creation: 13 Nov 2013
Date of revision:
Network games; Hawk/Dove games; finitely repeated game;
Find related papers by JEL classification:
- D85 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Network Formation
- 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
- C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior
This paper has been announced in the following NEP Reports:
- NEP-ALL-2013-11-22 (All new papers)
- NEP-CDM-2013-11-22 (Collective Decision-Making)
- NEP-EVO-2013-11-22 (Evolutionary Economics)
- NEP-EXP-2013-11-22 (Experimental Economics)
- NEP-GTH-2013-11-22 (Game Theory)
- NEP-HPE-2013-11-22 (History & Philosophy of Economics)
- NEP-NET-2013-11-22 (Network Economics)
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