An Experimental Investigation of Unprofitable Games

We investigate behavior in two unprofitable games—where Maxmin strategies do not form a Nash equilibrium yet guarantee the same payoff as Nash equilibrium strategies—that vary in the riskiness of the Nash strategy. We find that arguments for the implausibility of Nash equilibrium are confirmed by our experiments; however, claims that this will lead to Maxmin play are not. Neither solution concept accounts for more than 53% of choices in either game. The results indicate that the tension between the Nash and Maxmin strategies does not resolve itself over the course of the experiment. Moreover, the relative performance of the solution concepts is sensitive to the riskiness of the Nash strategy. Journal of Economic Literature Classification Numbers: C72, C92.  2002 Elsevier Science (USA)