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Gaming against Managers in Incentive Systems: Experimental Results with Chinese Students and Chinese Managers

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  • David J. Cooper

Abstract

We examine strategic interactions between firms and planners in China, comparing behavior between: (i) students and managers with field experience with this situation, (ii) standard versus increased monetary incentives, and (iii) sessions conducted "in context," making explicit reference to interactions between planners and managers, and those without any such references. The dynamics of play are similar across treatments with play only gradually, and incompletely, converging on a pooling equilibrium. A fivefold increase in incentives significantly increases initial levels of strategic play. Games played in context generated greater levels of strategic play for managers, with minimal impact on students.

Suggested Citation

  • David J. Cooper, 1999. "Gaming against Managers in Incentive Systems: Experimental Results with Chinese Students and Chinese Managers," American Economic Review, American Economic Association, vol. 89(4), pages 781-804, September.
  • Handle: RePEc:aea:aecrev:v:89:y:1999:i:4:p:781-804
    Note: DOI: 10.1257/aer.89.4.781
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    More about this item

    JEL classification:

    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • P31 - Economic Systems - - Socialist Institutions and Their Transitions - - - Socialist Enterprises and Their Transitions

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