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Equilibrium play and best response to (stated) beliefs in normal form games

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  • Rey-Biel, Pedro

Abstract

We report experimental results on a series of ten one-shot two-person 3x3 normal form games with unique equilibrium in pure strategies played by non-economists. In contrast to previous experiments in which game theory predictions fail dramatically, a majority of actions taken coincided with the equilibrium prediction (70.2%) and were best-responses to subjects' stated beliefs (67.2%). In constant-sum games, 78% of actions taken were predicted by the equilibrium model, outperforming simple K-level reasoning models. We discuss how non-trivial game characteristics related to risk aversion, efficiency concerns and social preferences may affect the predictive value of different models in simple normal form games.

Suggested Citation

  • Rey-Biel, Pedro, 2009. "Equilibrium play and best response to (stated) beliefs in normal form games," Games and Economic Behavior, Elsevier, vol. 65(2), pages 572-585, March.
    • Handle: RePEc:eee:gamebe:v:65:y:2009:i:2:p:572-585
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    More about this item

    Keywords

    Experiments Normal form games Constant sum games Stated beliefs K-level reasoning;

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games

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