Paying Attention to Payoffs in Analogy-Based Learning
This paper introduces the payoff-confirming analogy-based expectation equilibrium (PCABEE) as a way to refine the set of analogy-based equilibria and the associated admissible analogy partitions. In addition to the actions of others, own payoff history provides information about others’ strategies but, yet, non-Bayesian Nash equilibria may exist both with an incorrect and a correct prior. We provide general conditions when this happens. Two stylized employer-employee interactions, one with a correct and one with an incorrect prior, are provided illustrating how PCABEE can be used to analyze robust stereotypes and how incorrect such stereotypes may lead to discrimination.
|Date of creation:||28 Dec 2009|
|Date of revision:|
|Contact details of provider:|| Postal: |
Phone: (+46 8) 736 9670
Fax: (+46 8) 31 64 22
Web page: http://www.hhs.se/site/
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Drew Fudenberg & David K. Levine, 1998.
"The Theory of Learning in Games,"
MIT Press Books,
The MIT Press,
edition 1, volume 1, number 0262061945, June.
- Mohlin, Erik, 2009.
SSE/EFI Working Paper Series in Economics and Finance
721, Stockholm School of Economics, revised 08 Jul 2009.
- Ed Hopkins, 2002.
"Two Competing Models of How People Learn in Games,"
Econometric Society, vol. 70(6), pages 2141-2166, November.
- Ed Hopkins, 2001. "Two Competing Models of How People Learn in Games," NajEcon Working Paper Reviews 625018000000000226, www.najecon.org.
- Ed Hopkins, 2000. "Two Competing Models of How People Learn in Games," ESE Discussion Papers 51, Edinburgh School of Economics, University of Edinburgh.
- Ed Hopkins, 2001. "Two Competing Models of How People Learn in Games," Levine's Working Paper Archive 625018000000000226, David K. Levine.
- Drew Fudenberg & David K. Levine, 2009.
"Learning and Equilibrium,"
Annual Review of Economics,
Annual Reviews, vol. 1(1), pages 385-420, 05.
- Fryer Roland & Jackson Matthew O., 2008. "A Categorical Model of Cognition and Biased Decision Making," The B.E. Journal of Theoretical Economics, De Gruyter, vol. 8(1), pages 1-44, February.
- Kenneth J. Arrow, 1998. "What Has Economics to Say about Racial Discrimination?," Journal of Economic Perspectives, American Economic Association, vol. 12(2), pages 91-100, Spring.
- Eddie Dekel & Drew Fudenberg & David K. Levine, 2000.
"Learning to Play Bayesian Games,"
1322, Northwestern University, Center for Mathematical Studies in Economics and Management Science, revised Jul 2001.
- Eddie Dekel & Drew Fudenberg & David K. Levine, 2001. "Learning to Play Bayesian Games," Harvard Institute of Economic Research Working Papers 1926, Harvard - Institute of Economic Research.
- Dekel, Eddie & Fudenberg, Drew & Levine, David, 2004. "Learning to Play Bayesian Games," Scholarly Articles 3200612, Harvard University Department of Economics.
- Eddie Dekel & Drew Fudenberg & David K Levine, 2002. "Learning to Play Bayesian Games," Levine's Working Paper Archive 625018000000000151, David K. Levine.
- Philippe Jehiel, 2005.
"Analogy-Based Expectation Equilibrium,"
784828000000000106, UCLA Department of Economics.
- Ignacio Esponda, 2008. "Behavioral Equilibrium in Economies with Adverse Selection," American Economic Review, American Economic Association, vol. 98(4), pages 1269-91, September.
- Eyster, Erik & Rabin, Matt, 2002.
Department of Economics, Working Paper Series
qt6xf4782t, Department of Economics, Institute for Business and Economic Research, UC Berkeley.
- Eyster, Erik & Rabin, Matthew, 2002. "Cursed Equilibrium," Department of Economics, Working Paper Series qt7p2911dn, Department of Economics, Institute for Business and Economic Research, UC Berkeley.
- Erik Eyster & Matt Rabin, 2003. "Cursed Equilibrium," Method and Hist of Econ Thought 0303002, EconWPA.
- David Cooper & John Kagel, 2008. "Learning and transfer in signaling games," Economic Theory, Springer, vol. 34(3), pages 415-439, March.
- Fudenberg, Drew & Levine, David K, 1993.
Econometric Society, vol. 61(3), pages 523-45, May.
- Erev, Ido & Roth, Alvin E, 1998. "Predicting How People Play Games: Reinforcement Learning in Experimental Games with Unique, Mixed Strategy Equilibria," American Economic Review, American Economic Association, vol. 88(4), pages 848-81, September.
- Sendhil Mullainathan, 2002. "A Memory-Based Model Of Bounded Rationality," The Quarterly Journal of Economics, MIT Press, vol. 117(3), pages 735-774, August.
- Ido Erev & Alvin Roth & Robert Slonim & Greg Barron, 2007. "Learning and equilibrium as useful approximations: Accuracy of prediction on randomly selected constant sum games," Economic Theory, Springer, vol. 33(1), pages 29-51, October.
- Akerlof, George A, 1970. "The Market for 'Lemons': Quality Uncertainty and the Market Mechanism," The Quarterly Journal of Economics, MIT Press, vol. 84(3), pages 488-500, August.
- John Huyck & Raymond Battalio & Frederick Rankin, 2007. "Selection dynamics and adaptive behavior without much information," Economic Theory, Springer, vol. 33(1), pages 53-65, October.
- Miettinen, Topi, 2009. "The partially cursed and the analogy-based expectation equilibrium," Economics Letters, Elsevier, vol. 105(2), pages 162-164, November.
When requesting a correction, please mention this item's handle: RePEc:hhs:hasite:0007. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Evelina Bonnier)The email address of this maintainer does not seem to be valid anymore. Please ask Evelina Bonnier to update the entry or send us the correct address
If references are entirely missing, you can add them using this form.