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A Popperian test of level-k theory

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  • Shaun Hargreaves Heap

    (University of East Anglia)

  • David Rojo Arjona

    (Chapman University)

  • Robert Sugden

    (University of East Anglia)

Abstract

We report an experimental test of level-k theory, applied to three simple games with non-neutral frames: Coordination, Discoordination and Hide and Seek. Using the same frame for all three games, we derive hypotheses that apply across the games and are independent of prior assumptions about salience. Those hypotheses are not confirmed by our experimental results. Our findings contrast with previous research which has fitted parameterised level-k models to Hide and Seek data. We show that, as a theory-testing criterion, the existence of a plausible model that replicates the main patterns in these data has a high probability of false positives.

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File URL: http://www.uea.ac.uk/documents/166500/0/CBESS-12-06/15a3d3da-de61-4fd8-b787-bd5025a43dc1
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Bibliographic Info

Paper provided by School of Economics, University of East Anglia, Norwich, UK. in its series Working Paper series, University of East Anglia, Centre for Behavioural and Experimental Social Science (CBESS) with number 12-06.

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Date of creation: 26 Sep 2012
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Handle: RePEc:uea:wcbess:12-06

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Postal: Helen Chapman, School of Economics, University of East Anglia, Norwich Research Park, Norwich, NR4 7TJ, UK
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Related research

Keywords: level-k theory; Popper; Hide and Seek; coordination; discoordination;

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References

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  1. Nicholas Bardsley & Judith Mehta & Chris Starmer & Robert Sugden, 2010. "Explaining Focal Points: Cognitive Hierarchy Theory "versus" Team Reasoning," Economic Journal, Royal Economic Society, vol. 120(543), pages 40-79, 03.
  2. Rubinstein, A., 1999. "Experience from a Course in Game Theory: Pre and Post-Class Problem Sets as a Didactic Device," Papers 7-99, Tel Aviv.
  3. Vincent P. Crawford & Uri Gneezy & Yuval Rottenstreich, 2008. "The Power of Focal Points Is Limited: Even Minute Payoff Asymmetry May Yield Large Coordination Failures," American Economic Review, American Economic Association, vol. 98(4), pages 1443-58, September.
  4. Nagel, Rosemarie, 1995. "Unraveling in Guessing Games: An Experimental Study," American Economic Review, American Economic Association, vol. 85(5), pages 1313-26, December.
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