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Recommended play and correlated equilibria: an experimental study

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  • Timothy Cason
  • Tridib Sharma

Abstract

This study reports a laboratory experiment wherein subjects play a hawk-dove game. We try to implement a correlated equilibrium with payoffs outside the convex hull of Nash equilibrium payoffs by privately recommending play. We find that subjects are reluctant to follow certain recommendations. We are able to implement this correlated equilibrium, however, when subjects play against robots that always follow recommendations, including in a control treatment in which human subjects receive the robot "earnings." This indicates that the lack of mutual knowledge of conjectures, rather than social preferences, explains subjects' failure to play the suggested correlated equilibrium when facing other human players.
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Suggested Citation

  • Timothy Cason & Tridib Sharma, 2007. "Recommended play and correlated equilibria: an experimental study," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 33(1), pages 11-27, October.
    • Handle: RePEc:spr:joecth:v:33:y:2007:i:1:p:11-27
    DOI: 10.1007/s00199-006-0155-x
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    More about this item

    Keywords

    Game theory; Experiments; Coordination; Common knowledge; C72;
    All these keywords.

    JEL classification:

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

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