IDEAS home Printed from https://ideas.repec.org/p/zbw/wzbeoc/spii2014305.html
   My bibliography  Save this paper

Is response time predictive of choice? An experimental study of threshold strategies

Author

Listed:
  • Schotter, Andrew
  • Trevino, Isabel

Abstract

This paper investigates the usefulness of non-choice data, namely response times, as a predictor of threshold behavior in a simple global game experiment. Our results indicate that the signal associated to the highest or second highest response time at the beginning of the experiment are both unbiased estimates of the threshold employed by subjects at the end of the experiment. This predictive ability is lost when we move to the third or higher response times. Moreover, the response time predictions are better predictors of observed behavior than the equilibrium predictions of the game. They are also robust, in the sense that they characterize behavior in an out-of-treatment exercise where we use the strategy method to elicit thresholds. This paper is the first to point out the predictive power of response times in a strategic situation.

Suggested Citation

  • Schotter, Andrew & Trevino, Isabel, 2014. "Is response time predictive of choice? An experimental study of threshold strategies," Discussion Papers, Research Unit: Economics of Change SP II 2014-305, WZB Berlin Social Science Center.
    • Handle: RePEc:zbw:wzbeoc:spii2014305
    as

    Download full text from publisher

    File URL: https://www.econstor.eu/bitstream/10419/98843/1/790039338.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Drew Fudenberg & Philipp Strack & Tomasz Strzalecki, 2018. "Speed, Accuracy, and the Optimal Timing of Choices," American Economic Review, American Economic Association, vol. 108(12), pages 3651-3684, December.
    2. Morris, Stephen & Shin, Hyun Song, 1998. "Unique Equilibrium in a Model of Self-Fulfilling Currency Attacks," American Economic Review, American Economic Association, vol. 88(3), pages 587-597, June.
    3. Carlsson, Hans & van Damme, Eric, 1993. "Global Games and Equilibrium Selection," Econometrica, Econometric Society, vol. 61(5), pages 989-1018, September.
    4. Caplin, Andrew & Schotter, Andrew, 2008. "The Foundations of Positive and Normative Economics: A Handbook," OUP Catalogue, Oxford University Press, number 9780195328318.
    5. Piovesan, Marco & Wengström, Erik, 2009. "Fast or fair? A study of response times," Economics Letters, Elsevier, vol. 105(2), pages 193-196, November.
    6. Frank Heinemann & Rosemarie Nagel & Peter Ockenfels, 2009. "Measuring Strategic Uncertainty in Coordination Games," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 76(1), pages 181-221.
    7. Xavier Gabaix & David Laibson & Guillermo Moloche & Stephen Weinberg, 2006. "Costly Information Acquisition: Experimental Analysis of a Boundedly Rational Model," American Economic Review, American Economic Association, vol. 96(4), pages 1043-1068, September.
    8. repec:cup:judgdm:v:14:y:2019:i:4:p:381-394 is not listed on IDEAS
    9. Rubinstein, Ariel, 2008. "Comments On Neuroeconomics," Economics and Philosophy, Cambridge University Press, vol. 24(3), pages 485-494, November.
    10. Christopher F. Chabris & David Laibson & Carrie L. Morris & Jonathon P. Schuldt & Dmitry Taubinsky, 2009. "The Allocation of Time in Decision-Making," Journal of the European Economic Association, MIT Press, vol. 7(2-3), pages 628-637, 04-05.
    11. Urs Fischbacher, 2007. "z-Tree: Zurich toolbox for ready-made economic experiments," Experimental Economics, Springer;Economic Science Association, vol. 10(2), pages 171-178, June.
    12. Andrew Caplin & Mark Dean, 2015. "Revealed Preference, Rational Inattention, and Costly Information Acquisition," American Economic Review, American Economic Association, vol. 105(7), pages 2183-2203, July.
    13. Ariel Rubinstein, 2007. "Instinctive and Cognitive Reasoning: A Study of Response Times," Economic Journal, Royal Economic Society, vol. 117(523), pages 1243-1259, October.
    14. Ernst Fehr & Antonio Rangel, 2011. "Neuroeconomic Foundations of Economic Choice--Recent Advances," Journal of Economic Perspectives, American Economic Association, vol. 25(4), pages 3-30, Fall.
    15. repec:cup:judgdm:v:5:y:2010:i:6:p:437-449 is not listed on IDEAS
    16. Michael Woodford, 2014. "Stochastic Choice: An Optimizing Neuroeconomic Model," American Economic Review, American Economic Association, vol. 104(5), pages 495-500, May.
    17. Ryan Webb, 2019. "The (Neural) Dynamics of Stochastic Choice," Management Science, INFORMS, vol. 65(1), pages 230-255, January.
    18. Szkup, Michal & Trevino, Isabel, 2020. "Sentiments, strategic uncertainty, and information structures in coordination games," Games and Economic Behavior, Elsevier, vol. 124(C), pages 534-553.
    19. Ian Krajbich & Bastiaan Oud & Ernst Fehr, 2014. "Benefits of Neuroeconomic Modeling: New Policy Interventions and Predictors of Preference," American Economic Review, American Economic Association, vol. 104(5), pages 501-506, May.
    20. Clithero, John A., 2018. "Improving out-of-sample predictions using response times and a model of the decision process," Journal of Economic Behavior & Organization, Elsevier, vol. 148(C), pages 344-375.
    21. Wilcox, Nathaniel T, 1993. "Lottery Choice: Incentives, Complexity and Decision Time," Economic Journal, Royal Economic Society, vol. 103(421), pages 1397-1417, November.
    22. Frank Heinemann & Rosemarie Nagel & Peter Ockenfels, 2004. "The Theory of Global Games on Test: Experimental Analysis of Coordination Games with Public and Private Information," Econometrica, Econometric Society, vol. 72(5), pages 1583-1599, September.
    23. Ariel Rubinstein, 2007. "Instinctive and Cognitive Reasoning: Response Times Study," Levine's Bibliography 321307000000001011, UCLA Department of Economics.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Strittmatter, Anthony & Sunde, Uwe & Zegners, Dainis, 2022. "Speed, Quality, and the Optimal Timing of Complex Decisions: Field Evidence," Rationality and Competition Discussion Paper Series 317, CRC TRR 190 Rationality and Competition.
    2. Clithero, John A., 2018. "Response times in economics: Looking through the lens of sequential sampling models," Journal of Economic Psychology, Elsevier, vol. 69(C), pages 61-86.
    3. Recalde, María P. & Riedl, Arno & Vesterlund, Lise, 2018. "Error-prone inference from response time: The case of intuitive generosity in public-good games," Journal of Public Economics, Elsevier, vol. 160(C), pages 132-147.
    4. Carlos Alós-Ferrer & Ernst Fehr & Nick Netzer, 2021. "Time Will Tell: Recovering Preferences When Choices Are Noisy," Journal of Political Economy, University of Chicago Press, vol. 129(6), pages 1828-1877.
    5. Avoyan, Ala & Schotter, Andrew, 2020. "Attention in games: An experimental study," European Economic Review, Elsevier, vol. 124(C).
    6. John Van Huyck & Ajalavat Viriyavipart & Alexander L. Brown, 2018. "When less information is good enough: experiments with global stag hunt games," Experimental Economics, Springer;Economic Science Association, vol. 21(3), pages 527-548, September.
    7. Andrew Caplin & Daniel Martin, 2016. "The Dual-Process Drift Diffusion Model: Evidence From Response Times," Economic Inquiry, Western Economic Association International, vol. 54(2), pages 1274-1282, April.
    8. Arkady Konovalov & Ian Krajbich, 2016. "Revealed Indifference: Using Response Times to Infer Preferences," Working Papers 16-01, Ohio State University, Department of Economics.
    9. Echenique, Federico & Saito, Kota, 2017. "Response time and utility," Journal of Economic Behavior & Organization, Elsevier, vol. 139(C), pages 49-59.
    10. Goeschl, Timo & Lohse, Johannes, 2018. "Cooperation in public good games. Calculated or confused?," European Economic Review, Elsevier, vol. 107(C), pages 185-203.
    11. Ariel Rubenstein, 2013. "Response time and decision making: An experimental study," Judgment and Decision Making, Society for Judgment and Decision Making, vol. 8(5), pages 540-551, September.
    12. Krajbich Ian & Smith Stephanie M., 2015. "Modeling Eye Movements and Response Times in Consumer Choice," Journal of Agricultural & Food Industrial Organization, De Gruyter, vol. 13(1), pages 55-72, January.
    13. Rubinstein, Ariel, 2012. "Response Time and Decision Making: A “Free” Experimental Study," Foerder Institute for Economic Research Working Papers 275782, Tel-Aviv University > Foerder Institute for Economic Research.
    14. repec:cup:judgdm:v:8:y:2013:i:5:p:540-551 is not listed on IDEAS
    15. Goeschl, Timo & Lohse, Johannes, 2016. "Cooperation in Public Good Games. Calculated or Confused?," Working Papers 0626, University of Heidelberg, Department of Economics.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Carlos Alós-Ferrer & Ernst Fehr & Nick Netzer, 2021. "Time Will Tell: Recovering Preferences When Choices Are Noisy," Journal of Political Economy, University of Chicago Press, vol. 129(6), pages 1828-1877.
    2. Carlos Alós-Ferrer & Johannes Buckenmaier, 2021. "Cognitive sophistication and deliberation times," Experimental Economics, Springer;Economic Science Association, vol. 24(2), pages 558-592, June.
    3. Clithero, John A., 2018. "Response times in economics: Looking through the lens of sequential sampling models," Journal of Economic Psychology, Elsevier, vol. 69(C), pages 61-86.
    4. Recalde, María P. & Riedl, Arno & Vesterlund, Lise, 2018. "Error-prone inference from response time: The case of intuitive generosity in public-good games," Journal of Public Economics, Elsevier, vol. 160(C), pages 132-147.
    5. Jan Hausfeld & Sven Resnjanskij, 2017. "Risky Decisions and the Opportunity Costs of Time," TWI Research Paper Series 108, Thurgauer Wirtschaftsinstitut, Universität Konstanz.
    6. Arkady Konovalov & Ian Krajbich, 2016. "Revealed Indifference: Using Response Times to Infer Preferences," Working Papers 16-01, Ohio State University, Department of Economics.
    7. David J. Cooper & Ian Krajbich & Charles N. Noussair, 2019. "Choice-Process Data in Experimental Economics," Journal of the Economic Science Association, Springer;Economic Science Association, vol. 5(1), pages 1-13, August.
    8. S. Cerreia-Vioglio & F. Maccheroni & M. Marinacci & A. Rustichini, 2017. "Multinomial logit processes and preference discovery: inside and outside the black box," Working Papers 615, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University.
    9. Simone Cerreia-Vioglio & Fabio Maccheroni & Massimo Marinacci, 2020. "Multinomial logit processes and preference discovery: outside and inside the black box," Working Papers 663, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University.
    10. Echenique, Federico & Saito, Kota, 2017. "Response time and utility," Journal of Economic Behavior & Organization, Elsevier, vol. 139(C), pages 49-59.
    11. Carlos Alós-Ferrer & Michele Garagnani, 2022. "Strength of preference and decisions under risk," Journal of Risk and Uncertainty, Springer, vol. 64(3), pages 309-329, June.
    12. Helland, Leif & Iachan, Felipe S. & Juelsrud, Ragnar E. & Nenov, Plamen T., 2021. "Information quality and regime change: Evidence from the lab," Journal of Economic Behavior & Organization, Elsevier, vol. 191(C), pages 538-554.
    13. Strittmatter, Anthony & Sunde, Uwe & Zegners, Dainis, 2022. "Speed, Quality, and the Optimal Timing of Complex Decisions: Field Evidence," Rationality and Competition Discussion Paper Series 317, CRC TRR 190 Rationality and Competition.
    14. Hébert, Benjamin & Woodford, Michael, 2023. "Rational inattention when decisions take time," Journal of Economic Theory, Elsevier, vol. 208(C).
    15. Cary Frydman & Ian Krajbich, 2022. "Using Response Times to Infer Others’ Private Information: An Application to Information Cascades," Management Science, INFORMS, vol. 68(4), pages 2970-2986, April.
    16. Masiliūnas, Aidas, 2017. "Overcoming coordination failure in a critical mass game: Strategic motives and action disclosure," Journal of Economic Behavior & Organization, Elsevier, vol. 139(C), pages 214-251.
    17. Ambroise Descamps & Sébastien Massoni & Lionel Page, 2022. "Learning to hesitate," Experimental Economics, Springer;Economic Science Association, vol. 25(1), pages 359-383, February.
    18. John Van Huyck & Ajalavat Viriyavipart & Alexander L. Brown, 2018. "When less information is good enough: experiments with global stag hunt games," Experimental Economics, Springer;Economic Science Association, vol. 21(3), pages 527-548, September.
    19. repec:cup:judgdm:v:14:y:2019:i:4:p:381-394 is not listed on IDEAS
    20. Arkady Konovalov & Ian Krajbich, 2019. "Revealed strength of preference: Inference from response times," Judgment and Decision Making, Society for Judgment and Decision Making, vol. 14(4), pages 381-394, July.
    21. Radu, Vranceanu & Besancenot, Damien & Dubart, Delphine, 2013. "Can Rumors and Other Uninformative Messages Cause Illiquidity ?," ESSEC Working Papers WP1309, ESSEC Research Center, ESSEC Business School, revised Jun 2014.

    More about this item

    Keywords

    response time; threshold strategies; global games;
    All these keywords.

    JEL classification:

    • C71 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Cooperative Games
    • C9 - Mathematical and Quantitative Methods - - Design of Experiments
    • D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles
    • D89 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Other

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:zbw:wzbeoc:spii2014305. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ZBW - Leibniz Information Centre for Economics (email available below). General contact details of provider: https://edirc.repec.org/data/owwzbde.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.