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Sequential reciprocity in two-player, two-stage games: An experimental analysis

  • Dhaene, Geert
  • Bouckaert, Jan

We experimentally test Dufwenberg and Kirchsteiger's (2004) theory of sequential reciprocity in a sequential prisoner's dilemma and a mini-ultimatum game. Data on behavior and first- and second-order beliefs allow us to classify each subject's behavior as a material best response, a reciprocity best response, both, or none. We found that in both games the behavior of about 80% of the first movers was a material best response, a reciprocity best response, or both. The remaining 20% of first movers almost always made choices that were "too kind" according to Dufwenberg and Kirchsteiger's theory. Second-mover behavior, in both games, was in line with the predictions of the theory. We found first- and second-order beliefs to be unbiased in the sequential prisoner's dilemma, but biased in the mini-ultimatum game.

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Article provided by Elsevier in its journal Games and Economic Behavior.

Volume (Year): 70 (2010)
Issue (Month): 2 (November)
Pages: 289-303

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Handle: RePEc:eee:gamebe:v:70:y:2010:i:2:p:289-303
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