‘Lead, Follow or Cooperate’: Endogenous Timing & Cooperation in Symmetric Duopoly Games.

‘Lead, Follow or Cooperate’: Endogenous Timing & Cooperation in Symmetric Duopoly Games.

Date: 2011
By: Marco Marini (Department of Economics, Society & Politics, Università di Urbino “Carlo Bo" and CREI, Università di Roma III)
Giorgio Rodano (Dipartimento di Informatica e Sistemistica “Antonio Ruberti", Università di Roma “La Sapienza")
URL: http://d.repec.org/n?u=RePEc:urb:wpaper:11_12&r=net
The aim of this paper is to extend Hamilton and Slutsky’s (1990) endogenous timing game by including the possibility for players to cooperate. At an initial stage players are assumed to announce both their purpose to play early or late a given duopoly game as well as their intention to cooperate or not with their rival. The cooperation and timing formation rule is rather simple: when both players agree to cooperate and play with a given timing, they end up playing their actions coordinately and simultaneously. Otherwise, they play as singletons with the timing as prescribed by their own announcement. We check for the existence of a subgame perfect Nash equilibrium (in pure strategies) of such a cooperation-timing duopoly game. Two main results on the emergence of cooperation are provided. If players’ actions in the symmetric duopoly game are strategic substitutes and there is no discount, cooperating early (as a grand coalition) is a subgame perfect equilibrium of the extended timing-cooperation game. Conversely, cooperating late (at period two) represents an equilibrium when playersstrategies are strategic complements. Other equilibria are also possible. Most importantly, our model shows that, in general, the success of cooperation is a¤ected by the endogenous timing of the game. Moreover, the slope of players’ best-replies appears crucial both for the success of cooperation as well as for the players’ choice of sequencing their market actions.
Keywords: Endogenous Timing, Cooperation
JEL: C70

Mechanism Experiments and Policy Evaluations

Ludwig, Jens, Jeffrey R. Kling, and Sendhil Mullainathan. 2011. “Mechanism Experiments and Policy Evaluations." Journal of Economic Perspectives, 25(3): 17–38.

Abstract Randomized controlled trials are increasingly used to evaluate policies. How can we make these experiments as useful as possible for policy purposes? We argue greater use should be made of experiments that identify the behavioral mechanisms that are central to clearly specified policy questions, what we call “mechanism experiments." These types of experiments can be of great policy value even if the intervention that is tested (or its setting) does not correspond exactly to any realistic policy option.

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See also Journal of Economic Perspectives Vol. 25, Issue 3 — Summer 2011

(2) Why Economists Should Conduct Field Experiments and 14 Tips for Pulling One Off
John A. List
In this introduction to the symposium, I first offer an overview of the spectrum of experimental methods in economics, from laboratory experiments to the field experiments that are the subject of this symposium. I then offer some thoughts about the potential gains from doing economic research using field experiments and my own mental checklist of 14 steps to improve the chances of carrying out an economics field experiment successfully.
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(4) The Role of Theory in Field Experiments
David Card, Stefano DellaVigna and Ulrike Malmendier
We classify all published field experiments in five top economics journals from 1975 to 2010 according to how closely the experimental design and analysis are linked to economic theory. We find that the vast majority of field experiments (68 percent) are Descriptive studies that lack any explicit model; 18 percent are Single Model studies that test a single model-based hypothesis; 6 percent are Competing Models studies that test competing model-based hypotheses; and 8 percent are Parameter Estimation studies that estimate structural parameters in a completely specified model. We also classify laboratory experiments published in these journals over the same period and find that economic theory has played a more central role in the laboratory than in the field. Finally, we discuss in detail three sets of field experiments—on gift exchange, on charitable giving, and on negative income tax—that illustrate both the benefits and the potential costs of a tighter link between experimental design and theoretical underpinnings.
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(5) Field Experiments with Firms
Oriana Bandiera, Iwan Barankay and Imran Rasul
We discuss how the use of field experiments sheds light on long-standing research questions relating to firm behavior. We present insights from two classes of experiments—within and across firms—and draw common lessons from both sets. Field experiments within firms generally aim to shed light on the nature of agency problems. Along these lines, we discuss how field experiments have provided new insights on shirking behavior and the provision of monetary and nonmonetary incentives. Field experiments across firms generally aim to uncover firms’ binding constraints by exogenously varying the availability of key inputs such as labor, physical capital, and managerial capital. We conclude by discussing some of the practical issues researchers face when designing experiments and by highlighting areas for further research.
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IREE:2010 Special issue: Experimental Economics in the Classroom

International Review of Economics Education

(IREE), Volume 9, Issue 2, 2010

Mike Watts and Ross Guest

Discovering Economics in the Classroom with Experimental Economics and the Scottish Enlightenment
Taylor Jaworski, Vernon Smith and Bart Wilson

Teaching Opportunity Cost in an Emissions Permit Experiment
Charles Holt, Erica Myers, Markus Wrake, Dallas Burtraw and Svante Mandell

Do Classroom Experiments Affect the Number of Economics Enrollments and Majors?
Tisha Emerson and Beck Taylor

Experiential Learning with Experiments
Henrik Egbert and Vanessa Mertins

Patents and R&D: a Classroom Experiment
Amy Diduch

To Work or Not to Work … That is the Question: Labour Market Decisions in the Classroom
Arlene Garces-Ozanne and Phyll Esplin

Using Economic Classroom Experiments
Todd R. Kaplan and Dieter Balkenborg

macroeconomic experiment – Google 學術搜尋

總體經濟實驗:google 蒐尋結果

檔案類型: PDF/Adobe Acrobat – 快速檢視

This work is a continuation of a macroeconomic classroom experiment Although the number of macroeconomic experiments has increased over the past five

[PDF] Experimental Macroeconomics


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由 J Duffy 著作被引用 15 次相關文章
sociology. 2 Insights from Macroeconomic Experiments. To date, experimental macroeconomics research has yielded some important insights, including

這一篇是簡要的文獻回顧; 其中有提到其它的文獻回顧:

Surveys of experimental macroeconomics are found in Ochs (1995), Duffy (1998) and Ricciuti (2004).

  • Ochs, J. (1995), “Coordination Problems,” in J.H. Kagel and A.E. Roth, eds., The Handbook of Experimental Economics Princeton: Princeton University Press, 195—251.
  • Duffy, J. (1998), “Monetary Theory in the Laboratory,” Federal Reserve Bank of St. Louis Economic Review, 80 (September/October), 9-26.
  • Ricciuti, R. (2004) “Bringing Macroeconomics into the Lab” International Center for Economic Research, working paper no. 26.

[PDF] Macroeconomics: A Survey of Laboratory Research∗


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由 J Duffy 著作2008被引用 6 次相關文章
This chapter surveys laboratory experiments addressing macroeconomic phenomena. The …. competitive equilibrium as the first macro-economic experiment.

這一篇是較完整的文獻回顧 (應該是準備要出書的)


Denise Hazlett’s Classroom Experiments in Macroeconomics

Money Supply Game  in Economics Network Economics Network of the Higher Education Academy


Course: Barcelona LeeX Experimental Economics Summer School in Macroeconomics

Does commitment or feedback influence myopic loss aversion?: An experimental analysis

Thomas Langer and Martin Weber (2008) " Does commitment or feedback influence myopic loss aversion?: An experimental analysis" Journal of Economic Behavior & Organization, Volume 67, Issues 3-4, September 2008, Pages 810-819. via DOI;

這篇和 Langer andWeber (2008) 重覆

Notes by Yi-Nung

這篇將投資期間長/短 , 和資訊迴饋頻率 (frequent/infrequent) 兩種因素進行交叉實驗, 實驗結果和 Bellemare et al. (2005) 的並不十分一致; Bellemare et al. (2005) 主要實驗設計在於資訊迴饋頻率 frequent/infrequent, 其 treatment 有三種:

H: 投資期間1期, 資訊迴饋頻率每1期
M: 投資期間3期, 資訊迴饋頻率每1期
L: 投資期間3期, 資訊迴饋頻率每3期

Bellemare et al. (2005) 實驗結果是: 投資額度 L~M>H

Original Abstract

Empirical research has demonstrated that a lower feedback frequency combined with a longer period of commitment decreases myopia and thereby increases the willingness to invest in a risky asset. In an experimental study, we disentangle the intertwined manipulation of feedback frequency and commitment to analyze how each individual variable contributes to the change in myopia and how they interact. We find that the period of commitment exerts a substantial impact and the feedback frequency a far less pronounced impact. There is a strong interaction between both variables. The results have significant implications for real world intertemporal decision making.

Keywords: Intertemporal decision making; Myopic loss aversion; Feedback frequency; Length of commitment; Evaluation period


Bellemare et al. (2005) Myopic loss aversion: Information feedback vs. investment flexibility, Economics Letters, Volume 87, Issue 3, June 2005, Pages 319-324.

Individual Expectations and Aggregate Macro Behavior


Individual Expectations and Aggregate Macro Behavior

Date: 2011-05
By: Tiziana Assenza
Peter Heemeijer
Cars Hommes
Domenica Massaro
URL: http://d.repec.org/n?u=RePEc:dnb:dnbwpp:298&r=net
The way in which individual expectations shape aggregate macroeconomic variables is crucial for the transmission and effectiveness of monetary policy. We study the individual expectations formation process and the interaction with monetary policy, within a standard New Keynesian model, by means of laboratory experiments with human subjects. We find that a more aggressive monetary policy that sets the interest rate more than point for point in response to inflation stabilizes inflation in our experimental economies. We use a simple model of individual learning, with a performance-based evolutionary selection among heterogeneous forecasting heuristics, to explain coordination of individual expectations and aggregate macro behavior observed in the laboratory experiments. Three aggregate outcomes are observed: convergence to some equilibrium level, persistent oscillatory behaviour and oscillatory convergence. A simple heterogeneous expectations switching model fits individual learning as well as aggregate outcomes and outperforms homogeneous expectations benchmarks.
Keywords: Experiments; Monetary Policy; Expectations; Heterogeneity
JEL: C91

The Effects of Penalty Design on Market Performance: Experimental Evidence from an Emissions Trading Scheme with Auctioned Permits

The Effects of Penalty Design on Market Performance: Experimental Evidence from an Emissions Trading Scheme with Auctioned Permits

Date: 2010-12
By: Restiani, Phillia
Betz, Regina
URL: http://d.repec.org/n?u=RePEc:ags:eerhrr:107586&r=net
This paper investigates the behavioural implications of penalty designs on market performance using an experimental method. Three penalty types and two penalty levels are enforced in a laboratory permit market with auctioning, including the Australian Carbon Pollution Reduction Scheme proposed design of tying the penalty rate to the auction price. Compliance strategies are limited to undertaking irreversible abatement investment decisions or buying permits. We aim to assess how penalty design under the presence of subjectsâ risk preferences might affect compliance incentives, permit price discovery, and efficiency. In contrast to theory, we find that penalty levels serve as a focal point that indicates compliance costs and affects compliance strategies. The make-good provision penalty provides stronger compliance incentives than the other penalty types. However, the theory holds with regard to permit price discovery, as we find no evidence of the effect of penalty design on auction price. Interestingly, risk preference does not directly affect compliance decision, but it does influence price discovery, which evidently is a significant factor in compliance decisions as well as efficiency. Most importantly, a trade-off between investment incentives and efficiency is observed.
Keywords: emissions trading, penalty design, experiment, auction, irreversible investment, abatement, compliance, Environmental Economics and Policy, Resource /Energy Economics and Policy,

What is the actual shape of perception utility?

What is the actual shape of perception utility?

Date: 2011-06-20
By: Kontek, Krzysztof
URL: http://d.repec.org/n?u=RePEc:pra:mprapa:31715&r=net
Cumulative Prospect Theory (Kahneman, Tversky, 1979, 1992) holds that the value function is described using a power function, and is concave for gains and convex for losses. These postulates are questioned on the basis of recently reported experiments, paradoxes (gain-loss separability violation), and brain activity research. This paper puts forward the hypothesis that perception utility is generally logarithmic in shape for both gains and losses, and only happens to be convex for losses when gains are not present in the problem context. This leads to a different evaluation of mixed prospects than is the case with Prospect Theory: losses are evaluated using a concave, rather than a convex, utility function. In this context, loss aversion appears to be nothing more than the result of applying a logarithmic utility function over the entire outcome domain. Importantly, the hypothesis enables a link to be established between perception utility and Portfo-lio Theory (Markowitz, 1952A). This is not possible in the case of the Prospect Theory value function due its shape at the origin.
Keywords: Prospect Theory; value function; perception utility; loss aversion; gain-loss separability violation; neuroscience; Portfolio Theory; Decision Utility Theory.
JEL: D81



Date: 2011-06-21
By: Damien Besancenot (CEPN – Centre d’Economie de l’Université Paris Nord – Université Paris-Nord – Paris XIII – CNRS : UMR7234)
Radu Vranceanu (Economics Department – ESSEC Business School)
URL: http://d.repec.org/n?u=RePEc:hal:cepnwp:halshs-00602107&r=net
This paper brings experimental evidence on investors’ behavior subject to an “illiquidity" constraint, where the success of a risky project depends on the participation of a minimum number of investors. The experiment is set up as a frameless coordination game that replicates the investment context. Results confirm the insidious nature of the illiquidity risk: as long as a first illiquidity default does not occur, investors do not seem able to fully internalize it. After several defaults, agents manage to coordinate on a default probability above which they refuse to participate to the project. This default probability is lower than the default probability of the first illiquidity default.
Keywords: Coordination game, Illiquidity risk, Threshold strategy, Experimental economics

Ordering effects and strategic response in discrete choice experiments

Ordering effects and strategic response in discrete choice experiments

Date: 2010-03
By: Scheufele, Gabriela
Bennett, Jeff
URL: http://d.repec.org/n?u=RePEc:ags:eerhrr:107743&r=net
This study explores ordering effects and response strategies in repeated binary discrete choice experiments (DCE). Mechanism design theory and empirical evidence suggest that repeated choice tasks per respondent introduce strategic behavior. We find evidence that the order in which choice sets are presented to respondents may provide strategic opportunities that affect choice decisions (âstrategic responseâ). The findings propose that the âstrategic responseâ does not follow strong cost-minimization but other strategies such as weak cost-minimization or good deal/ bad deal heuristics. Evidence further suggests that participants, as they answer more choice questions, not only make more accurate choices (âinstitutional learningâ) but may also become increasingly aware of and learn to take advantage of the order in which choice sets are presented to them (âstrategic learningâ).
Keywords: discrete choice experiments, incentive compatibility, mixed logit models, ordering effects, repeated binary choice task, response strategies, Environmental Economics and Policy,