Strategic Sophistication of Individuals and Teams in Experimental Normal-Form Games
نویسندگان
چکیده
Strategic Sophistication of Individuals and Teams in Experimental Normal-Form Games We present an experiment on strategic thinking and behavior of individuals and teams in oneshot normal-form games. Besides making choices, decision makers have to state their firstand second-order beliefs. We find that teams play the Nash strategy significantly more often, and their choices are more often consistent by being a best reply to first order beliefs. We identify the complexity of a game and the payoffs in equilibrium as determining the likelihood of consistent behavior according to textbook rationality. Using a mixture model, the estimated probability to play strategically is 62% for teams, but only 40% for individuals. JEL Classification: C72, C91, C92
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Strategic sophistication of individuals and teams. Experimental evidence
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