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Individual and Group Behaviours in the Traveller's Dilemma: An Experimental Study

  • Andrea Morone


    (LEE & Department of Economics, Universitat Jaume I
    Department of Economics, University of Bari)

  • Piergiuseppe Morone


    (LEE & Department of Economics, Universitat Jaume I
    Department of Economics, University of Foggia)

This paper provides an experimental test of the traveller's dilemma using individual and group data. Our investigation aims to address three fundamental research questions, which can be summarised as follows: (i) claims are affected by the size of the penalty/reward; (ii) individual decisions differ significantly from group decisions; (iii) individual claims are affected by the induction of a focal point a là Schelling. Experimental findings reported in this paper provide answers to each of these questions showing that: (i) although the size of the penalty/reward did not affect subject choices in the first-period, it played a key role in determining subjects' behaviour in the repeated game; (ii) overall, groups behave more rationally, in the sense that they were always closer to the Nash equilibrium; iii) the reference point did not encourage coordination around the Pareto optimal choice.

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Paper provided by Economics Department, Universitat Jaume I, Castellón (Spain) in its series Working Papers with number 2012/09.

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Length: 19 pages
Date of creation: 2012
Date of revision:
Handle: RePEc:jau:wpaper:2012/09
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