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Homo Sapiens Sapiens Meets Homo Strategicus at the Laboratory

Author

Listed:
  • Ludovic Renou

  • Ralph C. Bayer

Abstract

Homo Strategicus populates the vast plains of Game Theory. He knows all logical implications of his knowledge (logical omniscience) and chooses optimal strategies given his knowledge and beliefs (rationality). This paper investigates the extent to which the logical capabilities of Homo Sapiens Sapiens resemble those possessed by Homo Strategicus. Controlling for other-regarding preferences and beliefs about the rationality of others, we show, in the laboratory, that the ability of Homo Sapiens Sapiens to perform complex chains of iterative reasoning is much better than previously thought. Subjects were able to perform about two to three iterations of reasoning on average.

Suggested Citation

  • Ludovic Renou & Ralph C. Bayer, 2008. "Homo Sapiens Sapiens Meets Homo Strategicus at the Laboratory," Discussion Papers in Economics 08/16, Division of Economics, School of Business, University of Leicester, revised Nov 2008.
    • Handle: RePEc:lec:leecon:08/16
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    References listed on IDEAS

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    Cited by:

    1. Renou, Ludovic & Schlag, Karl H., 2010. "Minimax regret and strategic uncertainty," Journal of Economic Theory, Elsevier, vol. 145(1), pages 264-286, January.
    2. Bayer, Ralph-C., 2010. "Intertemporal price discrimination and competition," Journal of Economic Behavior & Organization, Elsevier, vol. 73(2), pages 273-293, February.

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    JEL classification:

    • C70 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - General
    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior

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