Cognition and Behavior in Normal-Form Games: An Experimental Study

Abstract

''Human experience, which is constantly contradicting theory, is the great test of truth.''This paper reports experiments designed to study strategic sophistication, the extent to which behavior in games reflects attempts to predict others' decisions, taking their incentives into account. We study subjects' initial responses to normal-form games with various patterns of iterated dominance and unique pure-strategy equilibria without dominance, using a computer interface that allowed them to search for hidden payoff information, while recording their searches. Monitoring subjects' information searches along with their decisions allows us to better understand how their decisions are determined, and subjects' deviations from the search patterns suggested by equilibrium analysis help to predict their deviations from equilibrium decisions.

Finding Useful Questions: On Bayesian Diagnosticity, Probability, Impact, and Information Gain.

“…Several researchers explicitly make this point (Baron, 1985;Klayman & Ha, 1987;Klayman, 1987;Slowiaczek et al, 1992;Over & Jessop, 1998;Oaksford & Chater, 2003 (Skov & Sherman, 1986;Klayman & Ha, 1987, 1989Gorman, Stafford & Gorman, 1987;Devine, Hirt, & Gehrke, 1990; Finding useful questions 30 Slowiaczek et al, 1992;reviewed in Klayman, 1995). In some situations, strategies that reduce memory load (Costa-Gomes, Crawford, & Broseta, 2001) might also be used. These and other possibilities, including the sampling norms of the present paper, could be combined to form very flexible heuristic models.…”

Depth of Reasoning and Higher Order Beliefs

“…The main result of this paper, Theorem 3, is that in the email game there exists a 2 See Nagel (1995); Stahl andWilson (1994, 1995); Ho, Camerer, and Weigelt (1998); Costa-Gomes, Crawford, and Broseta (2001); Camerer (2003) ;Camerer, Ho, and Chong (2004); Costa-Gomes and Crawford (2006); Crawford and Iriberri (2007a,b); Crawford, Gneezy, and Rottenstreich (2008); Crawford, Kugler, Neeman, and Pauzner (2009) ;Healy, Georganas, and Weber (2010). finite number of messages such that coordination is possible among all "cognitive types," no matter how high their bound, provided that they receive at least that many messages.…”

Measuring Attention and Strategic Behavior in Games with Private Information

“…All interactions between subjects were computerized, using a Mousetracking extension of the open source software package 'Multistage Games' developed at Caltech. 17 Table 1 In each session, subjects played betting games with the five different sets of payoffs described in Figure 2. Furthermore, each of the five games were flipped with respect to player role and states to create five more games where Player 1 in the original game had the mirror image payoffs of Player 2 in the other version and vice versa.…”