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Cognitive Hierarchies in the Minimizer Game

Experimental tests of choice predictions in one-shot games show only little support for Nash equilibrium (NE). Poisson Cognitive Hierarchy (PCH) and level-k (LK) are behavioral models of the thinkingsteps variety where subjects differ in the number of levels of iterated reasoning they perform. Camerer et al. (2004) claim that substituting
the Poisson parameter = 1:5 yields a parameter-free PCH model (pfPCH) which predicts experimental data considerably better than NE. We design a new multi-person game, the Minimizer Game, as a testbed to compare initial choice predictions of NE, pfPCH and LK.
Data obtained from two large-scale online experiments strongly reject NE and LK, but are well in line with the point-prediction of pfPCH.

Identiferoai:union.ndltd.org:VIENNA/oai:epub.wu-wien.ac.at:5155
Date January 2016
CreatorsBerger, Ulrich, De Silva, Hannelore, Fellner-Röhling, Gerlinde
PublisherElsevier
Source SetsWirtschaftsuniversität Wien
LanguageEnglish
Detected LanguageEnglish
TypeArticle, PeerReviewed
Formatapplication/pdf
RightsCreative Commons: Attribution-NonCommercial-NoDerivatives 4.0 International (CC BY-NC-ND 4.0)
Relationhttps://doi.org/10.1016/j.jebo.2016.08.004, http://www.elsevier.com, http://epub.wu.ac.at/5155/

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