Boundary and interior equilibria: what drives convergence in a ‘beauty contest’?
We present an experimental game in the p-beauty framework. Building on the definitions of boundary and interior equilibria, we distinguish between ‘speed of convergence towards the game-theoretic equilibrium’ and ‘deviations of the guesses from the game-theoretic equilibrium’. In contrast to earlier findings (Güth et al., 2002), we show, under a different game parameterisation, that (i) interior equilibria initially produce smaller deviation of the guesses from the game-theoretic equilibrium compared to boundary equilibria; (ii) interior and boundary equilibria do not differ in the timeframe needed for convergence; (iii) the speed of convergence is higher in the boundary equilibrium.
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- Rosemarie Nagel & Antoni Bosch-Domènech & Albert Satorra & José García Montalvo, 1999.
"One, two, (three), infinity: Newspaper and lab beauty-contest experiments,"
Economics Working Papers
438, Department of Economics and Business, Universitat Pompeu Fabra.
- Antoni Bosch-Domènech & José G. Montalvo & Rosemarie Nagel & Albert Satorra, 2002. "One, Two, (Three), Infinity, ...: Newspaper and Lab Beauty-Contest Experiments," American Economic Review, American Economic Association, vol. 92(5), pages 1687-1701, December.
- Albert Satorra & Antoni Bosch-Domenech & Jose Garcia-Montalvo & Rosemarie Nagel, 2002. "One, two, (three), infinity: Newspaper and lab beauty-contest experiments," Artefactual Field Experiments 00011, The Field Experiments Website.
- Andrea Morone & Piergiuseppe Morone, 2007. "Guessing Games and People Behaviours: What Can we Learn?," SERIES 0015, Dipartimento di Scienze economiche e metodi matematici - Università di Bari, revised Feb 2007.
- Güth, Werner & Kocher, Martin G. & Sutter, Matthias, 2002.
"Experimental 'beauty contests' with homogeneous and heterogeneous players and with interior and boundary equilibria,"
Munich Reprints in Economics
18165, University of Munich, Department of Economics.
- Guth, Werner & Kocher, Martin & Sutter, Matthias, 2002. "Experimental 'beauty contests' with homogeneous and heterogeneous players and with interior and boundary equilibria," Economics Letters, Elsevier, vol. 74(2), pages 219-228, January.
- Güth, Werner & Kocher, Martin & Sutter, Matthias, 2001. "Experimental 'beauty contests' with homogeneous and heterogeneous players and with interior and boundary equilibria," SFB 373 Discussion Papers 2001,45, Humboldt University of Berlin, Interdisciplinary Research Project 373: Quantification and Simulation of Economic Processes.
- Duffy, John & Nagel, Rosemarie, 1997. "On the Robustness of Behaviour in Experimental "Beauty Contest" Games," Economic Journal, Royal Economic Society, vol. 107(445), pages 1684-1700, November.
- Weber, Roberto A., 2003. "'Learning' with no feedback in a competitive guessing game," Games and Economic Behavior, Elsevier, vol. 44(1), pages 134-144, July.
- Nagel, Rosemarie, 1995. "Unraveling in Guessing Games: An Experimental Study," American Economic Review, American Economic Association, vol. 85(5), pages 1313-26, December.
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