Experimental Economics: Volume 1: Economic Decisions

207 Pages·2015·2.69 MB·English

by  Pablo Branas-Garza, Antonio Cabrales (eds.)

Experimental Economics

Experimental Economics
Volume 1: Economic Decisions
Edited by
Pablo Branas-Garza
Middlesex University London, UK
and
Antonio Cabrales
University College London, UK
Translated by Manuel Muñoz-Herrera
University of Groningen, The Netherlands
Technical review by David Kernohan
Middlesex University London, UK
Selection and editorial matter © Pablo Branas-Garza and Antonio Cabrales 2015
Chapters © Contributors 2015
Softcover reprint of the hardcover 1st edition 2015 978-1-137-53818-5
First published in Spanish by Antoni Bosch editor under the title
Economia experimental y del comportamiento edited by Pablo Branas-Garza.
This edition has been translated by Manuel Muñoz-Herrera, and published under
licence from Antoni Bosch editor. The authors have asserted their right to be
identified as the authors of this Work.
All rights reserved. No reproduction, copy or transmission of this
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p C opyright, Designs and Patents Act 1988, or under the terms of any licence
permitting limited copying issued by the Copyright Licensing Agency,
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The authors have asserted their rights to be identified as the authors of this work
in accordance with the Copyright, Designs and Patents Act 1988.
First published 2015 by
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ISBN 978-1-349-56044-8 ISBN 978-1-137-53819-2 (eBook)
DOI 10.1057/9781137538192
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To María
To Isabel

Contents
List of Figures viii
L ist of Tables ix
Acknowledgments x
Notes on Contributors xii
1 Experiments in Economics 1
P ablo Branas-Garza and Iván Barreda
2 Individual Decision-Making 17
M anel Baucells and Konstantinos V. Katsikopoulos
3 Game Theory: Basic Concepts 34
P enélope Hernández and Marina Pavan
4 Coordination Games 53
Maríapaz Espinosa and Penélope Hernández
5 Initial Responses in Strategic Situations 7 2
Nagore Iriberri and Pedro Rey-Biel
6 Social Preferences 87
A ntonio Cabrales and Giovanni Ponti
7 Cooperation 105
J uan Antonio Lacomba and Raúl López-Pérez
8 Bargaining 124
A urora García-Gallego and Luis M. Miller
9 Responses from the Body: An Introduction to
Neuroeconomics 135
Giorgio Coricelli and Rosemarie Nagel
10 Gender Differences in Cooperation and Competition 154
Roberto Hernán and Praveen Kujal
References 1 69
Index 1 87
vii
List of Figures
2.1 Decision 1 18
2.2 Decision 2 18
2.3 Risk Neutral 19
2.4 Most of us 20
2.5 Decision 3 22
2.6 Decision 4 – Likely results of H (20 times F) 23
2.7 The subjective value function 24
2.8 Hyperbolic discount factor 26
3.1 Sequential game 45
3.2 Binary dictator game 47
3.3 Ultimatum game 48
3.4 Subgame for the ultimatum game when 1 has chosen A 4 9
3.5 Subgame for the ultimatum game when 1 has chosen E 5 0
3.6 Trust game 51
4.1 Geographical coordination 68
4.2 Movements in the sequential game 69
6.1 Ultimatum game and dictator game 88
6.2 Individual estimation of the parameters of
Fehr-Schmidt’s function 97
7.1 Decrease of cooperation in repeated VCG 108
7.2 Material punishments promote cooperation in the
repeated VCG 115
7.3 Evidence against the learning hypothesis in
repeated VCG 120
7.4 Types of players according to their behavior in the VCG 1 21
9.1 A neuroeconomics experiment 148
viii
List of Tables
3.1 Simultaneous game 37
3.2 Incentives game 38
3.3 Simultaneous game with a dominant action 40
3.4 Game from Table 3.3 without strategy RR 41
3.5 Matching Pennies game 42
4.1 Coordination game with symmetric payoffs 54
4.2 The Battle of the Sexes 56
4.3 Payoff and risk dominance 58
4.4 Stag Hunt Dilemma 58
4.5 Cooper et al . (1994) 59
4.6 Anticoordination games 60
4.7 Coordinating with many others 61
4.8 Strategy “α” 63
5.1 Coordination game 75
5.2 Normal form game 78
5.3 Iterated deletion of dominated strategies 79
6.1 Joint estimation of α andββconditional on the
variables of the questionnaire 98
7.1 Prisoner’s dilemma 111

ix