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The Minority of Three-Game: An Experimental and Theoretical Analysis

Author

Listed:
  • Thorsten Chmura

    (Department of Economics, University of Munich)

  • Werner Güth

    () (Max Planck Institute of Economics, Strategic Interaction Group)

  • Thomas Pitz

    (Nottingham University Business School China)

  • Anthony Ziegelmeyer

    (Max Planck Institute of Economics, Strategic Interaction Group)

Abstract

We report experimental and theoretical results on the minority of three-game where three players have to choose one of two alternatives independently and the most rewarding alternative is the one chosen by a single player. This coordination game has many asymmetric equilibria in pure strategies that are non strict and payoff-asymmetric, and a unique symmetric mixed strategy equilibrium in which each player's behavior is based on the toss of a fair coin. We show that such a straightforward behavior is predicted by Harsanyi and Selten's (1988) equilibrium selection theory as well as alternative solution concepts like impulse balance equilibrium and sampling equilibrium. Our results indicate that participants rely on various decision rules, and that only a quarter of them decide according to the toss of a fair coin. Reinforcement learning is the most successful decision rule as it describes best the behavior of about a third of our participants.

Suggested Citation

  • Thorsten Chmura & Werner Güth & Thomas Pitz & Anthony Ziegelmeyer, 2010. "The Minority of Three-Game: An Experimental and Theoretical Analysis," Jena Economic Research Papers 2010-071, Friedrich-Schiller-University Jena.
  • Handle: RePEc:jrp:jrpwrp:2010-071
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    References listed on IDEAS

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    Cited by:

    1. Linde, Jona & Sonnemans, Joep & Tuinstra, Jan, 2014. "Strategies and evolution in the minority game: A multi-round strategy experiment," Games and Economic Behavior, Elsevier, vol. 86(C), pages 77-95.
    2. Giovanna Devetag & Francesca Pancotto & Thomas Brenner, 2011. "The Minority Game Unpacked: Coordination and Competition in a Team-based Experiment," LEM Papers Series 2011/18, Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy.
    3. Giovanna Devetag & Francesca Pancotto & Thomas Brenner, 2014. "The minority game unpacked:," Journal of Evolutionary Economics, Springer, vol. 24(4), pages 761-797, September.
    4. Takashi Yamada & Nobuyuki Hanaki, 2016. "An Experiment on Lowest Unique Integer Games," Post-Print halshs-01204814, HAL.
    5. Yamada, Takashi & Hanaki, Nobuyuki, 2016. "An experiment on Lowest Unique Integer Games," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 463(C), pages 88-102.
    6. Rapoport, Amnon & Gisches, Eyran J. & Daniel, Terry & Lindsey, Robin, 2014. "Pre-trip information and route-choice decisions with stochastic travel conditions: Experiment," Transportation Research Part B: Methodological, Elsevier, vol. 68(C), pages 154-172.

    More about this item

    Keywords

    Coordination; Minority game; Mixed strategy; Learning models; Experiments;

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness

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