Pairwise Interaction on Random Graphs

We analyze dynamic local interaction in population games where the local interaction structure (modeled as a graph) can change over time: A stochastic process generates a random sequence of graphs. This contrasts with models where the initial interaction structure (represented by a deterministic graph or the realization of a random graph) cannot change over time.

A Stochastic Model of the Co-evolution of Networks and Strategies

We consider a theoretical model of co-evolution of networks and strategies whose components are exclusively supported by experimental observations. We can show that a particular kind of sophisticated behavior (anticipatory better reply) will result in stable population states which are most frequently visited in co-evolution experiments.evolution, network, strategy, experiment

Going on the Long Race? - Employment Duration and (De)Regulation of Experimental Stochastic Labor Markets

If the future market wage is uncertain, engaging in long-term employment is risky, with the risk depending on how regulated the labor market is. In our experiment long-term employment can result either from offering long-term contracts or from repeatedly and mutually opting for rematching. Treatments differ in how regulations restrict the employer's flexibility in adapting the employment contract to changes of the market (wage). All treatments allow for longer contract duration as well as for mutually opting to be rematched. Effort is chosen by employees after a contract is concluded. Treatments vary from no flexibility to no restriction at all. Will more (downward) flexibility be used in ongoing employment but reduce efficiency? If so, deregulation may weaken rather than promote labor market efficiency. And will regulation crowd out long-term employment, either in the form of long-term contracts or voluntary rematching?deregulation, employment contracts, wage flexibility, principal-agent theory, experimental economics, repeated interaction

Pairwise interaction on random graphs

We analyze dynamic local interaction in population games where the local interaction structure (modeled as a graph) can change over time: A stochastic process generates a random sequence of graphs. This contrasts with models where the initial interaction structure (represented by a deterministic graph or the realization of a random graph) cannot change over time

Reciprocity - an indirect evolutionary analysis

This paper investigates strategic interaction between rational agents whose preferences evolve over time. Players face a pecuniary �game of life� comprising the ultimatum game and the dictator game. Utility may but need not be attached to the reciprocation of fair and unfair play by the opponent and equitable payoff distributions as proposed by Falk and Fischbacher (2001). Evolutionary fitness is determined solely by material success � regardless of the motives for its achievement. Agents cannot explicitly condition the social component of their preferences on whether they face the ultimatum or dictator game. Under these conditions, agents develop a strong preference for reciprocation but little interest in an equitable distribution as such. This corresponds to equitable ultimatum offers but full surplus appropriation by dictators. Adding an exogenous constraint on the possible divergence between preference for reciprocation and for an equitable distribution either makes ultimatum divisions asymmetric or dictators become generous depending on the relative frequency of ultimatum and dictator interaction.

Trading Goods versus Sharing Money - An Experiment Testing Wether Fairness and Efficiency are Frame Dependent

Systematic experiments with distribution games (for a survey, see Roth, 1995) have shown that participants are strongly motivated by fairness and efficiency considerations. This evidence, however, results mainly from experimental designs asking directly for sharing monetary rewards. But even when not just one kind of monetary tokens is distributed efficiency and fairness are less influential. We investigate and confirm this frame dependency more systematically by comparing net-trade-proposals and payoff-proposals for the same exchange economy with two traders, two commodities and multi-period-negotiations.

Voluntary contributing in a neighborhood public good game: An experimental study

In repeated Public Good Games contributions might be influenced by different motives. The variety of motives for deciding between (more or less) free-riding probably explains the seemingly endless tradition of theoretical and experimental studies of repeated Public Good Games. To more clearly distinguish the motives, we try to enrich the choice set by allowing players not only to contribute but also to locate their contribution to one of the player positions. The location choice affects what individual players gain, but not the overall efficiency of contributing, and allows for discrimination, e.g., rewarding and sanctioning co-players differently. Our experimental results show that adding location choice promotes voluntary cooperation, although discrimination itself has no signifficant effect on behavior. --Public Good Game,Neighborhood,Cooperation,Experimental Analysis

Do Social Networks Inspire Employment? - An Experimental Analysis -

There is robust field data showing that a frequent and successful way of looking for a job is via the intermediation of friends and relatives. Here we want to test this experimentally. Participants first play a simple public goods game with two interaction partners ('friends'), and share whatever they earn this way with two different sharing partners ('cousins') who have different friends. Thus one's social network contains two 'friends' and two 'cousins'. In the second phase of the experiment participants learn about a job opportunity for themselves and one additional vacancy and decide whom of their network they want to recommend and, if so, in which order. In case of coemployment, both employees compete for a bonus. Will one recommend others for the additional job in spite of this competition, will one prefer 'friends' or 'cousins' and how does this depend on contributions (of 'friends') or shared profits (with 'cousins')? Our findings are partly quite puzzling. Most participants, for instance, recommend quite actively but compete very fiercely for the bonus.

A simple questionnaire can change everything: Are strategy choices in coordination games stable?

This paper presents results from an experiment designed to study the effect of self reporting risk preferences on strategy choices made in a subsequently played 2x2 coordination game. The main finding is that the act of answering a questionnaire about one's own risk preferences significantly alters strategic behavior. Within a best response correspondence framework, this result can be explained by a change in either risk preferences or beliefs. We find that self reporting risk preferences induces an increase in subjects' risk aversion while keeping their beliefs unchanged. Our findings raise some questions about the stability of strategy choices in coordination games. --coordination game,questionnaire,risk preferences,beliefs,best response correspondence

Decentralized or Collective Bargaining in a Strategy Experiment

We present an experiment where two players bargain with a third player. They can bargain either separately or form a joint venture to bargain collectively. Our theoretical benchmark solution predicts decentralized bargaining, as only one player has an interest in forming a joint venture. However, we observe a significant amount of collective bargaining. Collective bargaining, when compared with decentralized bargaining, has no significant effect on the payoffs of the players in the joint venture but reduces the payoff of the third player. Nous présentons une expérience dans laquelle deux joueurs négocient avec un troisième joueur. Les deux joueurs peuvent négocier séparément ou former une coalition pour négocier collectivement avec le troisième. La solution théorique de référence prédit des négociations décentralisées, car seulement un des joueurs a intérêt à former une coalition. Les résultats de l'expérience montrent un nombre significatif de négociations collectives. Lorsque comparée à la négociation décentralisée, la négociation collective n'a pas d'effets significatifs sur les profits des joueurs de la coalition,0501s réduit le profit du troisième.Bargaining, joint venture, experimental economics, equilibrium selection, Négociation, coalition, économie expérimentale, sélection d'équilibre