Behavior in a dynamic decision problem: An analysis of experimental evidence using a bayesian type classification algorithm

It has been long recognized that different people may use different strategies, or decision rules, when playing games or dealing with other complex decision problems. We provide a new Bayesian procedure for drawing inferences about the nature and number of decision rules that are present in a population of agents. We show that the algorithm performs well in both a Monte Carlo study and in an empirical application. We apply our procedure to analyze the actual behavior of subjects who are confronted with a difficult dynamic stochastic decision problem in a laboratory setting. The procedure does an excellent job of grouping the subjects into easily interpretable types. Given the difficultly of the decision problem, we were surprised to find that nearly a third of subjects were a “Near Rational” type that played a good approximation to the optimal decision rule. More than 40% of subjects followed a rule that we describe as “fatalistic,” since they play as if they don’t appreciate the extent to which payoffs are a controlled stochastic process. And about a quarter of the subjects are classified as “Confused,” since they play the game quite poorly. Interestingly, we find that those subjects who practiced most before playing the game for money were the most likely to play poorly. Thus, lack of effort does not seem to account for poor performance. It is our hope that, in future work, our type classification algorithm will facilitate the positive analysis of peoples’ behavior in many types of complex decision problems.behavioral experiments type-classification bayesian

Sustaining cooperation in trust games

It is well-known in evolutionary game theory that population clustering in Prisoner's Dilemma games allows some cooperative strategies to invade populations of stable defecting strategies. We adapt this idea of population clustering to a two-person trust game. Without knowing it, players are typed based on their recent track record as to whether or not they are trusting (Players 1) and whether or not they are trustworthy (Players 2). They are then paired according to those types: trustors with trustworthy types, and similarly non-trustors with untrustworthy types. In the control comparisons, Players 1 are randomly repaired with Players 2 without regard to type. We ask: are there natural tendencies for people to cooperate more frequently in environments in which they experience more cooperation in comparison with controls?exchange; trust; reciprocity; cooperation; clustering; bargaining; experimental economics

Sustaining Cooperation in trust Games

It is well-known in evolutionary game theory that population clustering in Prisoner Dilemma games allows some cooperative strategies to invade populations of stable defecting strategies. We adapt this idea of population clustering to a two-person trust game. Players are typed based on their recent track record as whether or not they are trusting (Players 1) and whether or not they are trustworthy (Players 2). They are then paired according to those types: trustors with trustworthy types, and similarly non-trustors with untrustworthy types. The empirical question we address is whether this adaptation of clustering to bargaining environments sustains cooperative play analogous to the situation in finitely repeated PD games.exchange, trust, reciprocity, cooperation, clustering, bargaining, experimental economics

Brood-rearing Period Cover Use By Wild Turkey Hens in Southcentral South Dakota

Brood-rearing period cover use by wild turkey (Meleagris gallopavo) hens with broods and those without, in Gregory County, South Dakota, was determined in order to formulate management suggestions for grassland/riparian woodland habitat. Two hens with broods and 12 hens without broods were studies through telemetry and direct observations form 5 July through 2 August and 3 August through 17 August of 1982 and 1982. Vegetational data were collected in 1983. Hens with broods selected for the grass/forb-dominated understory and 52% open canopy of south-facing savannah woodlands while their broods were less than 4 weeks of age. After 4 weeks, broods moved to the shrubby understory and 7% open canopy of north-facing bur oak forest. Broods hens did not appear to use cultivated fields, farmsteads, or bottomlands, and grasslands were avoided or used in proportion to availability. Hens without broods used cultivated fields, farmsteads, and bottomlands in proportion to availability, generally avoided grasslands, and selected woodlands

on the efficiency of team-based meritocracies

According to theory a pure meritocracy is efficient because individual members are competitively rewarded according to their individual contributions to society. However, purely individually based meritocracies seldom occur. We introduce a new model of social production called “team-based meritocracy” (TBM) in which individual members are rewarded based on their team membership. We demonstrate that as long as such team membership is both mobile and competitively based on contributions, individuals are able to tacitly coordinate a complex and counterintuitive asymmetric equilibrium that is close to Pareto-optimal, possibly indicating that such a group-based meritocracy could be a social structure to which humans respond with particular ease. Our findings are relevant to many contemporary societies in which rewards are at least in part determined via membership in organizations such as for example firms, and organizational membership is increasingly determined by contribution rather than privilege.social stratification, meritocracies, mechanism design, non-cooperative games, experiment, team production

HEURISTICS USED BY HUMANS WITH PREFRONTAL CORTEX DAMAGE: TOWARD AN EMPIRICAL MODEL OF PHINEAS GAGE

In many research contexts it is necessary to group experimental subjects into behavioral “types.” Usually, this is done by pre-specifying a set of candidate decision-making heuristics and then assigning each subject to the heuristic that best describes his/her behavior. Such approaches might not perform well when used to explain the behavior of subjects with prefrontal cortex damage. The reason is that introspection is typically used to generate the candidate heuristic set, but this procedure is likely to fail when applied to the decision-making strategies of subjects with brain damage. This research uses the type classification approach introduced by Houser, Keane and McCabe (2002) to investigate the heuristics used by subjects in the gambling experiment (Bechara, Damasio, Damasio and Anderson, 1994). An advantage of our classification approach is that it does not require us to specify the nature of subjects’ heuristics in advance. Rather, both the number and nature of the heuristics used are discerned directly from the experimental data. Our sample includes normal subjects, as well as subjects with damage to the ventromedial (VM) area of the prefrontal cortex. Subjects are “clustered” according to similarities in their heuristic, and this clustering does not preclude some normal and VM subjects from using the same decision rule. Our results are consistent with what others have found in subsequent experimentation with VM patients.experiments, heuristics, neuroeconomics, behavioral economics