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Risk attitudes and the stag-hunt game

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  • Büyükboyacı, Mürüvvet

Abstract

A stag-hunt game (with the risky and safe actions) has two pure Nash equilibria that are Pareto-rankable. The risky action leads either to the Pareto-superior equilibrium (high payoff) or to out of equilibrium (low payoff) depending on the opponent’s action. Both players may want to obtain high payoff but uncertainty about the opponent’s action may prevent them to take such strategic risk. This paper investigates how information about the risk attitude of an opponent affects a player’s action choice in the stag-hunt game. I find that although a subject’s propensity to choose the risky action depends on her opponent’s risk attitude, it does not depend on her own risk attitude.

Suggested Citation

  • Büyükboyacı, Mürüvvet, 2014. "Risk attitudes and the stag-hunt game," Economics Letters, Elsevier, vol. 124(3), pages 323-325.
    • Handle: RePEc:eee:ecolet:v:124:y:2014:i:3:p:323-325
    DOI: 10.1016/j.econlet.2014.06.019
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    References listed on IDEAS

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    Cited by:

    1. Buyukboyaci, Muruvvet & Kucuksenel, Serkan, 2016. "Coordination and Cheap Talk: Indirect versus Direct Messages," MPRA Paper 68964, University Library of Munich, Germany.
    2. Dongwei Guo & Mengmeng Fu & Hai Li, 2021. "Cooperation in Social Dilemmas: A Group Game Model with Double-Layer Networks," Future Internet, MDPI, vol. 13(2), pages 1-27, January.
    3. Mürüvvet Büyükboyacı & Serkan Küçükşenel, 2017. "Costly Pre‐Play Communication and Coordination in Stag‐Hunt Games," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 38(6), pages 845-856, September.

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    Keywords

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    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles
    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty

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