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Learning and decision costs in one‐person games
Author(s) -
Romeo Charles,
Sopher Barry
Publication year - 1999
Publication title -
journal of applied econometrics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 2.878
H-Index - 99
eISSN - 1099-1255
pISSN - 0883-7252
DOI - 10.1002/(sici)1099-1255(199907/08)14:4<335::aid-jae537>3.0.co;2-d
Subject(s) - stochastic game , maximization , risk dominance , mathematical economics , dominance (genetics) , stochastic dominance , economics , computer science , econometrics , microeconomics , game theory , repeated game , normal form game , biochemistry , chemistry , gene
This paper reports the results of a two‐part data analysis of learning in a repeated costly decision experiment. In the first part we test payoff dominance under the hypothesis of expected payoff maximization. We utilize a dynamic probability distribution over decisions for each player, characterizing what each player has learned about the payoff function by the moments from these distributions. In the second part, we test the hypothesis of expected payoff maximization for players in each treatment group. Expected payoff maximization is supported but payoff dominance is not. Copyright © 1999 John Wiley & Sons, Ltd.