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Ten Little Treasures of Game Theory and Ten Intuitive Contradictions

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  • Jacob K. Goeree
  • Charles A. Holt
Abstract
This paper reports laboratory data for a series of two-person games that are played only once. These games span the standard categories: static and dynamic games with complete and incomplete information. For each game, the treasure is a treatment for which behavior conforms quite nicely to the predictions of the Nash equilibrium or relevant refinement. In each case we change a key payoff parameter in a manner that does not alter the equilibrium predictions, but this theoretically neutral payoff change has a major (often dramatic) effect on observed behavior. These contradictions are generally consistent with simple economic intuition and with a model of iterated noisy introspection for one-shot games.

Suggested Citation

  • Jacob K. Goeree & Charles A. Holt, 2000. "Ten Little Treasures of Game Theory and Ten Intuitive Contradictions," Virginia Economics Online Papers 333, University of Virginia, Department of Economics.
    • Handle: RePEc:vir:virpap:333
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    More about this item

    Keywords

    Nash equilibrium; noncooperative games; experiments; bounded rationality; introspection;
    All these keywords.

    JEL classification:

    • C70 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - General

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