On the persistence of strategic sophistication

We examine whether the “Level-k” model of strategic behavior generates reliable cross-game predictions at the individual level. We find no correlation in subjects' estimated levels of reasoning across two families of games. Furthermore, estimating a higher level for Ann than Bob in one family of games does not predict their ranking in the other. Direct tests of strategic reasoning generally do not predict estimated levels. Within families of games, we find that levels are fairly consistent within one family, but not the other. Our results suggest that the use of Level-k reasoning varies by game, making prediction difficult

Accommodating stake effects under prospect theory

One of the stylized facts underlying prospect theory is a four-fold pattern of risk preferences. People have been shown to be risk seeking for small probability gains and large probability losses, while being risk averse for large probability gains and small probability losses. Another fourfold pattern of risk preferences over outcomes, postulated by Harry Markowitz in 1952, has received much less attention and is currently not integrated into prospect theory. In two experiments, we show that risk preferences may change over outcomes. While we find people to be risk seeking for small outcomes, this turns to risk neutrality and later risk aversion as stakes increase. We then show how a one-parameter logarithmic utility function fits such stake effects significantly better under prospect theory than the power or exponential functions mostly used when fitting prospect theory models. We further investigate the extent to which the use of ill-suited functional forms to represent utility may result in violations of prospect theory, and whether such violations disappear when using logarithmic utility

Overconfidence, incentives and digit ratio

This paper contributes to a better understanding of the biological underpinnings of overconfidence by analyzing performance predictions in the Cognitive Reflection Test with and without monetary incentives. In line with the existing literature we find that the participants are too optimistic about their performance on average; incentives lead to higher performance; and males score higher than females on this particular task. The novelty of this paper is an analysis of the relation between participants’ performance prediction accuracy and their second to fourth digit ratio. It has been reported that the digit ratio is a negatively correlated bio-marker of prenatal testosterone exposure. In the un-incentivized treatment, we find that males with low digit ratios, on average, are significantly more overconfident about their performance. In the incentivized treatment, however, we observe that males with low digit ratios, on average, are less overconfident about their performance. These effects are not observed in females. We discuss how these findings fit into the literature on testosterone and decision making and how they might help to explain seemingly opposing evidence

Effect of response format on cognitive reflection: Validating a two- and four-option multiple choice question version of the Cognitive Reflection Test

The Cognitive Reflection Test, measuring intuition inhibition and cognitive reflection, has become extremely popular since it reliably predicts reasoning performance, decision-making and beliefs. Across studies, the response format of CRT items sometimes differs, assuming construct equivalence of the tests with open-ended vs. multiple choice items (the equivalence hypothesis). Evidence and theoretical reasons, however, suggest that the cognitive processes measured by these response formats and their associated performances might differ (the non-equivalence hypothesis). We tested the two hypotheses experimentally by assessing the performance in tests with different response formats and by comparing their predictive and construct validity. In a between-subjects experiment (n = 452), participants answered an open-ended, a two- or a four-option response format of stem-equivalent CRT items and completed tasks on belief bias, denominator neglect and paranormal beliefs (benchmark indicators of predictive validity) as well as actively open-minded thinking and numeracy (benchmark indicators of construct validity). We found no significant differences between the three response formats in the number of correct responses, the number of intuitive responses (with the exception of the two-option version being higher than the other tests) and in the correlational patterns with the indicators of predictive and construct validity. All three test versions were similarly reliable but the multiple-choice formats were completed more quickly. We speculate that the specific nature of the CRT items helps to build construct equivalence among the different response formats. We recommend using the validated multiple-choice version of the CRT presented here, particularly the four-option CRT, for practical and methodological reasons

A causal account of the brain network computations underlying strategic social behavior

During competitive interactions, humans have to estimate the impact of their own actions on their opponent's strategy. Here we provide evidence that neural computations in the right temporoparietal junction (rTPJ) and interconnected structures are causally involved in this process. By combining inhibitory continuous theta-burst transcranial magnetic stimulation with model-based functional MRI, we show that disrupting neural excitability in the rTPJ reduces behavioral and neural indices of mentalizing-related computations, as well as functional connectivity of the rTPJ with ventral and dorsal parts of the medial prefrontal cortex. These results provide a causal demonstration that neural computations instantiated in the rTPJ are neurobiological prerequisites for the ability to integrate opponent beliefs into strategic choice, through system-level interaction within the valuation and mentalizing networks

Morphofunctional changes underlying intestinal dysmotility in diabetic RIP-I⁄hIFNb transgenic mice

The pathogenetic mechanisms underlying gastrointestinal dysmotility in diabetic patients remain poorly understood, although enteric neuropathy, damage to interstitial cells of Cajal (ICC) and smooth muscle cell injury are believed to play a role.The aim of this study was to investigate the morphological and functional changes underlying intestinal dysmotility in RIP-I ⁄ hIFNb transgenic mice treated with multiple very low doses of streptozotocin (20 mg⁄ kg, i.p., 5 days). Compared with vehicle-treated mice, streptozotocin-treated animals developed type 1 diabetes mellitus, with sustained hyperglycaemia for 3.5 months, polyphagia, polydipsia and increased faecal output without changes in faecal water content (metabolic cages). Diabetic mice had a longer intestine, longer ileal villi and wider colonic crypts (conventional microscopy) and displayed faster gastric emptying and intestinal transit. Contractility studies showed selective impaired neurotransmission in the ileum and mid-colon of diabetic mice. Compared with controls, the ileal and colonic myenteric plexus of diabetic mice revealed ultrastructural features of neuronal degeneration and HuD immunohistochemistry on whole-mount preparations showed 15% reduction in neuronal numbers. However, no immunohistochemical changes in apoptosis-related markers were noted. Lower absolute numbers of neuronal nitric oxide synthase- and choline acetyltransferase-immunopositive neurons and enhanced vasoactive intestinal polypeptide and substance P immunopositivity were observed. Ultrastructural and immunohistochemical analyses did not reveal changes in the enteric glial or ICC networks. In conclusion, this model of diabetic enteropathy shows enhanced intestinal transit associated with intestinal remodelling, including neuroplastic changes, and overt myenteric neuropathy. Such abnormalities are likely to reflect neuroadaptive and neuropathological changes occurring in this diabetic model