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Feature-based Choice and Similarity in Normal-form Games: An Experimental Study

  • Giovanna Devetag
  • Sibilla Di Guida

In this paper, we test the effect of descriptive "features" on initial strategic behavior in normal form games, where the term "descriptive" indicates all those features which can be modified without altering the (Nash) equilibrium structure of a game. Our experimental subjects behaved according to some simple heuristics based on descriptive features, and we observed that these heuristics were stable even across strategically different games. These findings indicate the need to incorporate descriptive features into models describing strategic sophistication in normal form games. Analysis of choice patterns and individual behavior indicates that non-equilibrium choices may derive from incorrect and simplified mental representations of the game structure, rather than from beliefs in other players' irrationality. We suggest how level-k and cognitive hierarchy models might be extended to account for heuristic-based and feature-based behavior.

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Paper provided by Laboratory of Economics and Management (LEM), Sant'Anna School of Advanced Studies, Pisa, Italy in its series LEM Papers Series with number 2010/18.

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Date of creation: 09 Oct 2010
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Handle: RePEc:ssa:lemwps:2010/18
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  11. Giovanna Devetag & Massimo Warglien, 2005. "Playing the wrong game: An experimental analysis of relational complexity and strategic misrepresentation," CEEL Working Papers 0504, Cognitive and Experimental Economics Laboratory, Department of Economics, University of Trento, Italia.
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  15. Reinhard Selten & Thorsten Chmura, 2005. "Stationary Concepts for Experimental 2x2 Games," Bonn Econ Discussion Papers bgse33_2005, University of Bonn, Germany.
  16. Miguel A. Costa-Gomes & Georg Weizs�cker, 2008. "Stated Beliefs and Play in Normal-Form Games," Review of Economic Studies, Oxford University Press, vol. 75(3), pages 729-762.
  17. Urs Fischbacher, 2007. "z-Tree: Zurich toolbox for ready-made economic experiments," Experimental Economics, Springer, vol. 10(2), pages 171-178, June.
  18. Stahl, Dale O. & Haruvy, Ernan, 2008. "Level-n bounded rationality and dominated strategies in normal-form games," Journal of Economic Behavior & Organization, Elsevier, vol. 66(2), pages 226-232, May.
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