Some problems with judging rationality

Swistak, Piotr

Abstract

The gap between game-theoretic predictions and actual choices people make in, for instance, gaming experiments has been over-interpreted as evidence against rationality of players. I consider a version of the ultimatum game and examine its equilibria under different assumptions about players’ preferences. Using standard notions of rationality I show that the discrepancy between the “normative” and the “descriptive” cannot be established by a simple comparison of what is predicted by the equilibrium choices and the actual choices

Keywords

game theory (8)behavioral game theory (1)ultimatum game (1)rationality (7)

References

Andersen, S., Ertaç, S., Gneezy, U., Hoffman, M., List, J. A. (2011). Stakes matter in ultimatum games. The American Economic Review, 101(7), 3427-3439. [Google Scholar]
Camerer, F. C. (2011). Behavioral Game Theory: Experiments in Strategic Interaction. Princeton NJ: Princeton University Press. [Google Scholar]
Camerer, C., Thaler, R. H. (1995). Anomalies: Ultimatums, dictators and manners. The Journal of Economic Perspectives, 9(2), 209-219. [Google Scholar]
Cameron, L. A. (1999). Raising the stakes in the ultimatum game: Experimental evidence from Indonesia. Economic Inquiry, 37(1), 47-59. [Google Scholar]
Davis, D. D., Holt, Ch. A. (1993). Experimental Economics. Princeton: Princeton University Press. [Google Scholar]
Güth, W., Schmittberger, R., Schwarze, B. (1982). An experimental analysis of ultimatum bargaining. Journal of Economic Behavior and Organization, 3(4), 367-388. [Google Scholar]
Hoffman, E., McCabe, K. A., Smith, V. L. (1998). Behavioral foundations of reciprocity: Experimental economics and evolutionary psychology. Economic Inquiry, 36(3), 335-352. [Google Scholar]
Hoffman, E., McCabe, K., Shachat, K., Smith, V. (1994). Preferences, property rights, and anonymity in bargaining games. Games and Economic Behavior, 7(3), 346-380. [Google Scholar]
Kaminski, M., Lissowski, G., Swistak, P. (2013). Formal theory and value judgments. Polish Sociological Review, 4(184), 409-429. [Google Scholar]
Levitt, S. D., List, J. A., Sadoff, S. E. (2011). Checkmate: Exploring backward induction among chess players. The American Economic Review, 101(2), 975-90. [Google Scholar]
McKelvey, R. D., Palfrey, T. R. (1995). Quantal response equilibria for normal form games. Games and Economic Behavior, 10, 6-38. [Google Scholar]
Mironova, V., Whitt, S. (2013). International peacekeeping, and positive peace: Experimental and survey evidence from Kosovo. Available at SSRN 2243770, 2013. [Google Scholar]
Palacios-Huerta, I., Volij, O. (2009). Field centipedes. The American Economic Review, 99(4), 1619-35. [Google Scholar]
Slonim, R., Roth, A. E. (1998). Learning in high stakes ultimatum games: An experiment in the Slovak Republic. Econometrica, 66(3), 569-596. [Google Scholar]
Wason, P. (1968). Reasoning about a rule. The Quarterly Journal of Experimental Psychology, 20(3), 273-281. [Google Scholar]
Weibull, J. (2004). Testing Game Theory. In: Advances in Understanding Strategic Behaviour: Game Theory, Experiments and Bounded Rationality (pp. 85-104). Essay in Honour of Werner Güth, by Steffen Huck. Basingstoke, UK: Palgrave MacMillan. [Google Scholar]

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APA style

Swistak, Piotr (2015). Some problems with judging rationality. (2015). Some problems with judging rationality. Decyzje, (23), 5-22. https://doi.org/10.7206/DEC.1733-0092.44 (Original work published 6/2015AD)

MLA style

Swistak, Piotr. “Some Problems With Judging Rationality”. 6/2015AD. Decyzje, no. 23, 2015, pp. 5-22.

Chicago style

Swistak, Piotr. “Some Problems With Judging Rationality”. Decyzje, Decyzje, no. 23 (2015): 5-22. doi:10.7206/DEC.1733-0092.44.

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CC-BY

[1] Andersen, S., Ertaç, S., Gneezy, U., Hoffman, M., List, J. A. (2011). Stakes matter in ultimatum games. The American Economic Review, 101(7), 3427-3439. [Google Scholar]

[2] Camerer, F. C. (2011). Behavioral Game Theory: Experiments in Strategic Interaction. Princeton NJ: Princeton University Press. [Google Scholar]

[3] Camerer, C., Thaler, R. H. (1995). Anomalies: Ultimatums, dictators and manners. The Journal of Economic Perspectives, 9(2), 209-219. [Google Scholar]

[4] Cameron, L. A. (1999). Raising the stakes in the ultimatum game: Experimental evidence from Indonesia. Economic Inquiry, 37(1), 47-59. [Google Scholar]

[5] Davis, D. D., Holt, Ch. A. (1993). Experimental Economics. Princeton: Princeton University Press. [Google Scholar]

[6] Güth, W., Schmittberger, R., Schwarze, B. (1982). An experimental analysis of ultimatum bargaining. Journal of Economic Behavior and Organization, 3(4), 367-388. [Google Scholar]

[7] Hoffman, E., McCabe, K. A., Smith, V. L. (1998). Behavioral foundations of reciprocity: Experimental economics and evolutionary psychology. Economic Inquiry, 36(3), 335-352. [Google Scholar]

[8] Hoffman, E., McCabe, K., Shachat, K., Smith, V. (1994). Preferences, property rights, and anonymity in bargaining games. Games and Economic Behavior, 7(3), 346-380. [Google Scholar]

[9] Kaminski, M., Lissowski, G., Swistak, P. (2013). Formal theory and value judgments. Polish Sociological Review, 4(184), 409-429. [Google Scholar]

[10] Levitt, S. D., List, J. A., Sadoff, S. E. (2011). Checkmate: Exploring backward induction among chess players. The American Economic Review, 101(2), 975-90. [Google Scholar]

[11] McKelvey, R. D., Palfrey, T. R. (1995). Quantal response equilibria for normal form games. Games and Economic Behavior, 10, 6-38. [Google Scholar]

[12] Mironova, V., Whitt, S. (2013). International peacekeeping, and positive peace: Experimental and survey evidence from Kosovo. Available at SSRN 2243770, 2013. [Google Scholar]

[13] Palacios-Huerta, I., Volij, O. (2009). Field centipedes. The American Economic Review, 99(4), 1619-35. [Google Scholar]

[14] Slonim, R., Roth, A. E. (1998). Learning in high stakes ultimatum games: An experiment in the Slovak Republic. Econometrica, 66(3), 569-596. [Google Scholar]

[15] Wason, P. (1968). Reasoning about a rule. The Quarterly Journal of Experimental Psychology, 20(3), 273-281. [Google Scholar]

[16] Weibull, J. (2004). Testing Game Theory. In: Advances in Understanding Strategic Behaviour: Game Theory, Experiments and Bounded Rationality (pp. 85-104). Essay in Honour of Werner Güth, by Steffen Huck. Basingstoke, UK: Palgrave MacMillan. [Google Scholar]

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