Cognition and framing in sequential bargaining for gains and losses

Noncooperative game-theoretic models of sequential bargaining give an underpinning to cooperative solution concepts derived from axioms, and have proved useful in applications (see Osborne and Rubinstein 1990). But experimental studies of sequential bargaining with discounting have generally found systematic deviations between the offers people make and perfect equilibrium offers derived from backward induction (e.g., Ochs and Roth 1989). We have extended this experimental literature in two ways. First, we used a novel software system to record the information subjects looked at while they bargained. Measuring patterns of information search helped us draw inferences about how people think, testing as directly as possible whether people use backward induction to compute offers. Second, we compared bargaining over gains that shrink over time (because of discounting) to equivalent bargaining over losses that expand over time. In the games we studied, two players bargain by making a finite number of alternating offers. A unique subgame-perfect equilibrium can be computed by backward induction. The induction begins in the last period and works forward. Our experiments use a three-round game with a pie of $5.00 and a 50-percent discount factor (so the pie shrinks to$2.50 and $1.25 in the second and third rounds). In the perfect equilibrium the first player offers the second player$1.25 and keeps $3.75

The role of avatars in e-government interfaces

This paper investigates the use of avatars to communicate live message in e-government interfaces. A comparative study is presented that evaluates the contribution of multimodal metaphors (including avatars) to the usability of interfaces for e-government and user trust. The communication metaphors evaluated included text, earcons, recorded speech and avatars. The experimental platform used for the experiment involved two interface versions with a sample of 30 users. The results demonstrated that the use of multimodal metaphors in an e-government interface can significantly contribute to enhancing the usability and increase trust of users to the e-government interface. A set of design guidelines, for the use of multimodal metaphors in e-government interfaces, was also produced

Redefine statistical significance

We propose to change the default P-value threshold for statistical significance from 0.05 to 0.005 for claims of new discoveries

Bose-Einstein condensate coupled to a nanomechanical resonator on an atom chip

We theoretically study the coupling of Bose-Einstein condensed atoms to the mechanical oscillations of a nanoscale cantilever with a magnetic tip. This is an experimentally viable hybrid quantum system which allows one to explore the interface of quantum optics and condensed matter physics. We propose an experiment where easily detectable atomic spin-flips are induced by the cantilever motion. This can be used to probe thermal oscillations of the cantilever with the atoms. At low cantilever temperatures, as realized in recent experiments, the backaction of the atoms onto the cantilever is significant and the system represents a mechanical analog of cavity quantum electrodynamics. With high but realistic cantilever quality factors, the strong coupling regime can be reached, either with single atoms or collectively with Bose-Einstein condensates. We discuss an implementation on an atom chip.Comment: published version (5 pages, 3 figures

The process-performance paradox in expert judgment - How can experts know so much and predict so badly?

A mysterious fatal disease strikes a large minority of the population. The disease is incurable, but an expensive drug can keep victims alive. Congress decides that the drug should be given to those whose lives can be extended longest, which only a few specialists can predict. The experts work around the clock searching for a cure; allocating the drug is a new chore they would rather avoid

Resonant coupling of a Bose-Einstein condensate to a micromechanical oscillator

We report experiments in which the vibrations of a micromechanical oscillator are coupled to the motion of Bose-condensed atoms in a trap. The interaction relies on surface forces experienced by the atoms at about one micrometer distance from the mechanical structure. We observe resonant coupling to several well-resolved mechanical modes of the condensate. Coupling via surface forces does not require magnets, electrodes, or mirrors on the oscillator and could thus be employed to couple atoms to molecular-scale oscillators such as carbon nanotubes.Comment: 9 pages, 4 figure

Timing and Virtual Observability in Ultimatum Bargaining and Weak Link Coordination Games

Previous studies have shown that simply knowing some players move first can affect behavior in games, even when the first-movers' moves are unobservable. This observation violates the game-theoretic principle that timing of unobserved moves is irrelevant. We extend this work by varying timing of unobservable moves in ultimatum bargaining games and "weak link" coordination games. Timing without observability affects both bargaining and coordination, but only weakly. The results are consistent with theories that allow "virtual observability" of first-mover choices, rather than theories in which timing matters only because first-mover advantage is used as a principle of equilibrium selection

Detecting Failures of Backward Induction: Monitoring Information Search in Sequential Bargaining

We did experiments in a three-round bargaining game where the (perfect) equilibrium offer was $1.25 and an equal split was$2.50. The average offer was $2.11. Patterns of information search (measured with a computerized information display) show limited lookahead rather than backward induction. Equilibrium theories which adjust for social utilities (reflecting inequality-aversion or reciprocity) cannot explain the results because they predict subjects will make equilibrium offers to “robot” players, but offers to robots are only a little lower. When trained subjects (who quickly learned to do backward induction) bargained with untrained subjects, offers ended up halfway between equilibrium and$2.11

Detecting Failures of Backward Induction: Monitoring Information Search in Sequential Bargaining

We ran three-round sequential bargaining experiments in which the perfect equilibrium offer was $1.25 and an equal split was$2.50. Subjects offered $2.11 to other subjects,$1.84 to “robot” players (who are known to play subgame perfectly), and $1.22 to robots after instruction in backward induction. Measures of information search showed that subjects did not look at the amounts being divided in different rounds in the correct order, and for the length of time, necessary for backward induction, unless they were specifically instructed. The results suggest that most of the departure from perfect equilibrium is due to limited computation and some is due to fairness

Auctioning the Right to Play Ultimatum Games and the Impact on Equilibrium Selection

We auction scarce rights to play the Proposer and Responder positions in ultimatum games. As a control treatment, we randomly allocate these rights and charge exogenous participation fees. These participation fee sequences match the auction price sequence from a session of the original treatment. With endogenous selection via auctions, we find that play converges to a session-specific Nash equilibrium, and auction prices emerge supporting this equilibrium by the principle of forward induction. With random assignment, we find play also converges to a session-specific Nash equilibrium as predicted by the principle of loss avoidance. While Nash equilibria with low offers are observed, the subgame perfect Nash equilibrium never is