Testing game theory without the social preference confound
AbstractWe propose an experimental method whose purpose is to induce selfish behavior in games for a broad class of social preferences. It provides a theoretical framework for testing game theoretical predictions by confronting subjects with a commonly known payoff matrix actually representing their preferences. The paper describes the empirical tests of this method based on the comparison of results from several popular experimental games played with and without our methodology. Apart from it being a test of validity of the method, our experiment helps answer the question of how useful social preferences could be in explaining commonly observed deviations from selfish rationality. Results suggest that our method does induce more selfish behaviors: a substantial part of the difference between predictions based on selfishness and observed behaviors seems indeed driven by such preferences. But they also indicate that a considerable share is left untouched, perhaps giving weight to alternative explanations.
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Bibliographic InfoPaper provided by Faculty of Economic Sciences, University of Warsaw in its series Working Papers with number 2012-06.
Length: 30 pages
Date of creation: 2012
Date of revision:
social preference; experimental game theory; ultimatum game; public goods game; trust game; prisoner's dilemma; dictator game;
Find related papers by JEL classification:
- A13 - General Economics and Teaching - - General Economics - - - Relation of Economics to Social Values
- C65 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Miscellaneous Mathematical Tools
- C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
- D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
- D03 - Microeconomics - - General - - - Behavioral Microeconomics; Underlying Principles
This paper has been announced in the following NEP Reports:
- NEP-ALL-2012-04-10 (All new papers)
- NEP-CBE-2012-04-10 (Cognitive & Behavioural Economics)
- NEP-EVO-2012-04-10 (Evolutionary Economics)
- NEP-EXP-2012-04-10 (Experimental Economics)
- NEP-GTH-2012-04-10 (Game Theory)
- NEP-HPE-2012-04-10 (History & Philosophy of Economics)
- NEP-SOC-2012-04-10 (Social Norms & Social Capital)
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