Nagore Iriberri, University of the Basque Country

"Naivete and Sophistication in Initial and Repeated Play in Games"

Abstract

Compared to more sophisticated equilibrium theory, naive, non-equilibrium behavioral rules often better describe individuals’ initial play in games. Additionally, in repeated play in games, when individuals have the opportunity to learn about their opponents’ past behavior, learning models of different sophistication levels are successful in explaining how individuals modify their behavior in response to the provided information. How do subjects following different behavioral rules in initial play modify their behavior after learning about past behavior? This study links both initial and repeated play in games by analyzing elicited behavior in 3 × 3 normal-form games using a within-subject laboratory design. We classify individuals into different behavioral rules in both initial and repeated play and test whether and/or how strategic naivete and sophistication in initial play correlate with naivete and sophistication in repeated play. We find no evidence of a positive correlation between naivete and sophistication in initialand repeated play.

Contact person: Alexander Sebald