Coalition Formation in a Legislative Voting Game

We experimentally investigate the Jackson-Moselle (2002) model where legislators bargain over policy proposals and the allocation of private goods. Key comparative static predictions of the model hold as policy proposals shift in the predicted direction with private goods, with the variance in policy outcomes increasing as well. Private goods increase total welfare even after accounting for their cost and help secure legislative compromise. Coalition formations are better characterized by an efficient equal split between coalition partners than the stationary subgame perfect equilibrium prediction

Outside options: another reason to choose the first-price auction

Pre-print draft dated October 2005. Final version published by Elsevier; available online at http://www.sciencedirect.com/In this paper we study equilibrium and experimental bidding behaviour in first-price and second-price auctions with outside options. We find that bidders do respond to outside options and to variations of common knowledge about competitors’ outside options. However, overbidding in first-price auctions is significantly higher with outside options than without. First-price auctions yield more revenue than second-price auctions. This revenue-premium is significantly higher with outside options. In second-price auctions the introduction of outside options has only a small effect

Are Subjects Making Financial Decisions in Lab Auctions or Are They Just Gambling?

Optimal bidding strategies in first-price and Dutch auctions are theoretically isomorphic but depend on bidder risk attitudes. However, laboratory experiments consistently find different behaviour between auction formats. This article explores whether the notion in psychology that financial and gambling risks are viewed differently can explain the discrepancy. Ultimately, the evidence does not support this hypothesis, but a bidder\u27s propensity to gamble is associated with how much risk he takes in both auctions whereas his propensity to take financial risks is not. The results suggest that subjects may view themselves as gambling in laboratory auctions rather than making financial decisions

Promote cooperation by localised small-world communication

The emergence and maintenance of cooperation within sizable groups of unrelated humans offer many challenges for our understanding. We propose that the humans' capacity of communication, such as how many and how far away the fellows can build up mutual communications, may affect the evolution of cooperation. We study this issue by means of the public goods game (PGG) with a two-layered network of contacts. Players obtain payoffs from five-person public goods interactions on a square lattice (the interaction layer). Also, they update strategies after communicating with neighbours in learning layer, where two players build up mutual communication with a power law probability depending on their spatial distance. Our simulation results indicate that the evolution of cooperation is indeed sensitive to how players choose others to communicate with, including the amount as well as the locations. The tendency of localised communication is proved to be a new mechanism to promote cooperation.Comment: 6 pages, 4 figure

Optimistic irrationality and overbidding in private value auctions

Bidding one’s value in a second-price, private-value auction is a weakly dominant solution (Vickrey in J Finance 16(1):8–37, 1961), but repeated experimental studies find more overbidding than underbidding. We propose a model of optimistically irrational bidders who understand that there are possible gains and losses associated with higher bids but who may overestimate the additional probability of winning and/or underestimate the potential losses when bidding above value. These bidders may fail to discover the dominant strategy—despite the fact that the dominant strategy only requires rationality from bidders—but respond in a common sense way to out-of-equilibrium outcomes. By varying the monetary consequences of losing money in experimental auctions we observe more overbidding when the cost to losing money is low, and less overbidding when the cost is high. Our findings lend themselves to models in which less than fully rational bidders respond systematically to out-of-equilibrium incentives, and we find that our model better fits the effects of our manipulations than most of the existing models we consider

Effects of inhomogeneous activity of players and noise on cooperation in spatial public goods games

We study the public goods game in the noisy case by considering the players with inhomogeneous activity teaching on a square lattice. It is shown that the introduction of the inhomogeneous activity of teaching of the players can remarkably promote cooperation. By investigating the effects of noise on cooperative behavior in detail, we find that the variation of cooperator density $\rho_C$ with the noise parameter $\kappa$ displays several different behaviors: $\rho_C$ monotonically increases (decreases) with $\kappa$; $\rho_C$ firstly increases (decreases) with $\kappa$ and then it decreases (increases) monotonically after reaching its maximum (minimum) value, which depends on the amount of the multiplication factor $r$, on whether the system is homogeneous or inhomogeneous, and on whether the adopted updating is synchronous or asynchronous. These results imply that the noise plays an important and nontrivial role in the evolution of cooperation.Comment: 4 pages, 4 figure

Infrared Gas Phase Intensity Measurements, Polar Tensors, And Effective Charges Of Vinylidene Fluoride And Its Deuterated Modifications

All gas phase fundamental vibrational intensities for vinylidene fluoride and its deuterated modifications have been measured. Isotopic invariance, G sum rule, and quantum chemical information have been used in selecting preferred experimental values for the dipole moment derivatives and polar tensor elements of these molecules. The values of these intensity parameters are compared with those found for other molecules. The experimental values are interpreted in terms of electronic charge distortions occurring in these molecules for the various vibrations. © 1982 American Institute of Physics.7731099110

The Effects of Shilling on Final Bid Prices in Online Auctions

An increasing number of reports of online auction fraud are of growing concern to auction operators and participants. In this research, we discuss reserve price shilling, where a bidder shills in order to avoid paying auction house fees, rather than to drive up the price of the final bid. We examine the effect that premium bids, since they are linked with reserve price shill bids, have upon the final selling price. We use 10,260 eBay auctions during April 2001, and identify 1,389 auctions involving 493 sellers and 1,314 involved in concurrent auctions that involving the exact same item. We find that premium bidding occurs 23 % of the time, in 263 of the 1,389 auctions. Using a theoretical perspective involving valuation signals, we show that other bidders may view high bids as signals that an item is worth more. Thus, they may be willing to pay more for the item than items that do not receive premium bids. The implications are disturbing in that sellers may be more motivated to enter a shill bid in order to drive up the final price in an online auction. We also examine and report on alternative hypotheses involving winner’s curse and the possibility of reserve price shill bids. Our results are developed in the context of a weighted leas