Common Pool Resource Management and the Effect of Heterogeneous Users: an Experimental Investigation
|
|
- Abigail Hodge
- 5 years ago
- Views:
Transcription
1 Common Pool Resource Management and the Effect of Heterogeneous Users: an Experimental Investigation Lance Howe University of Alaska, Anchorage Jim Murphy (future iterations)
2 Introduction This experiment builds on Walker, Gardner, Ostrom (1990) indirectly by adding heterogeneity (Hackett, Schlager,, Walker (1994)) adding a monitoring and sanctioning institution (Casari and Plott (2003)) adding an endowment switch anticipated and unanticipated Based on 10 controlled experiments (6 at UAA and 4 at UCLA), broad sample of undergraduate students, 80 unique subjects
3 Introduction Motivation: Decentralization of state forests (local common pool resources) property rights to limited participatory management given to communities India (JFM) and Nepal (Forest User Groups) heterogeneity and the impact of different rules on CPR use and income dist.. Management of CPR s s in rural Alaska: Alaska Native Village Corporation common property ownership arrangements - differing resources, rules and incentives, and users Endowment heterogeneity is an imperfect but useful start to exploring the effect of heterogeneity on CPR management.
4 Background A foundational CPR experiment (Walker, Gardner, and Ostrom,, 1990) finds in the no-rules environment environment over- investment and near complete rent dissipation the open access outcomes described by G. Hardin In subsequent experiments (Ostrom,, Walker, and Gardner, 1992; Walker, Gardner, Herr, Ostrom,, 2000; Cardenas, Stranland and Willis, 2000) efficiency can be significantly improved through cooperation facilitated mainly by communication and voting Lab experiments support field evidence - small groups of individuals can sustainably manage a common-pool resource with appropriate institutions, and Walker (1994) find that communication is an effective institution even with heterogeneity Hackett, Schlager, and Walker (1994)
5 Background Existing CPR papers focus on institutions that facilitate coalition building or improved collective action among different users (i.e. common property management of a common pool resource) This experiment explores the effect of monitoring and sanctions alone, with user heterogeneity, in promoting efficient CPR use (key ingredient of CPR management independent of the property right regime)
6 Background Sanctions in many CPR and Public Goods experiments subjects choose to punish after learning the contributions of other subjects (no monitoring or uncertainty in sanctions) punishment varies & the sanctioning player sets the fine Ostrom,, Walker, Gardner (1992) introduce a sanctioning mechanism to WGO (1990) Fehr and Gachter (2000) punishment is effective in promoting full contributions in public good game. Gurerk, Irlenbusch, Rockenbach (2006) a sanctioning environment is unanimously chosen (with near perfect cooperation) over a sanction free environment in a public goods game no uncertainty in the sanction. Cardenas, Stranlund and Willis (2000) some probability of inspection and a fine concurrent with the over-appropriation (akin to a government managed CPR)
7 Design This experiment Casari and Plott (2003): a monitoring and sanctioning Institution intended to reflect a local institution used in the Italian Alps for centuries Carte di Regola there exists a pre-announced limit and penalty for over- harvesting uncertain benefits and subjects incur a monitoring cost to inspect other players WGO design adding heterogeneity (Hackett, Schlager,, Walker (1994))
8 Background Questions/hypotheses explored in current paper 1. Efficiency outcomes are less than predicted efficiency outcomes with heterogeneous endowments 1a. Heterogeneous endowments reduce efficiency outcomes relative to homogeneous endowments 2. The opportunity to monitor and sanction (with weak sanctions) does not improve efficiency outcomes or 2a. A reference point does not change efficiency outcomes. 3. The opportunity to monitor and sanction (with strong sanctions) does not improve efficiency outcomes 4. An endowment switch will not affect efficiency outcomes 5. An unanticipated endowment switch leads to relatively less efficient outcomes compared to anticipated changes. Don t t as yet explore research questions related to monitoring and sanctioning behavior
9 n x i 1 i x Design In the WGO study, an individuals payoff function is given by: n n 2 [ a( x i ) b ( x i ) ] ( x i ) i 1 i 1 i where x individual investment in CPR i return on outside investment initial endowment
10 Design X F( X ) -200 X PO 1 a Nash N a ( ) X ( ) 2 b X open a N 1 b b
11 Design The payoff function becomes n x i 1 i x i n n 2 [ a( x i) b ( x i ) ] ( k x i) I isi I j i ijr ij i 1 i 1 s H *( x ), for x i i i ri, j ( s j k ), for x j
12 Design This experiment: Pareto Optimum play 56 total 77 each player Open Access play 112 total low endowment subjects 8 each high endowment subjects 20 each X X PO open 1 a ( ) 2 b a b
13 Design This experiment: Nash Equilibrium varies by player type low endowment subjects constrained at 8 high endowment subjects x Nash 1 k L i, H ( ) NH 1 b a ( ( b* ) H * p) 16 no sanctions and weak sanctions 14 stronger sanctions (above PO)
14 Design Sequence of Decision Rounds Heterogeneity Sanctions Exchange Rate Rounds Match 0 No None practice 5 Match 1 Yes None Match 2 Yes Weak Sanctions Match 3 Yes Stronger Sanctions Match 4 Yes (switch endowments) Stronger Sanctions.01 10
15 Sample Screen-shot stage 1 Design
16 Sample Screen-shot Stage 2 Design
17 Treatment # 1: Heterogeneity & no- rules environment environment Predicted Efficiency Outcomes in the No Rules Environment Walker, Gardner, and Ostrom (10 tokens) Walker, Gardner, and Ostrom (25 tokens) Casari and Plott Hackett, Schlager, Walker this Paper (match 1-3) this Paper (match 4) Pareto Optimal Play $ 0.41 $ 0.20 $ 1.22 $ 0.98 $ 0.49 $ 0.98 Nash as % of PO (low end.) 32.7 % 32.7 % 32.7 % Nash as % of PO (high end.) 65.3 % 65.3 % 65.3 % Nash as % of PO (all or avg) 39.5 % 39.5 % 39.5 % 49.0 % 49.0 % 49.0 %
18 T1: Heterogeneity & no-rules Predicted Efficiency: low Comparing Efficiency Outcomes in the No Rules Environment WGO (10 tokens) WGO (25 tokens) CP HSW 32.7 % Avg. Ind. Efficiency 32.7 % Actual Efficiency: low 35.1 % Predicted Efficiency: high 65.3 % 65.3 % Actual Efficiency: high 84.2 % Predicted Avg. efficiency 39.5 % 39.5 % 39.5 % 49.0 % 49.0 % Actual Avg. efficiency 37.2% % 28.4% 45.3%* 59.7 %** *random endowment sessions, no communication ** average individual efficiency over all sessions
19 T1: Heterogeneity & no-rules Figure 1. Average Investment in the Common Property Resource Across Rounds, Match 1, Low and High Endowment Subjects Mean Public Investment Low Endowment High Endowment
20 T1: Heterogeneity & no-rules Outcome: While low endowment players under-invest a large share of choices are at Nash Public Investment Choices, Match 1 below Nash at Nash above Nash total choices low endowment players 54.8% 45.3% 400 high endowment players 45.8% 7.8% 46.5% 400
21 T1: Heterogeneity & no-rules Outcome: and a significant percentage of low endowment players play at Nash Public Investment Choices for Low Endowment Players, Match 1 below Nash (8 or more times) at Nash (8 or more times) other strategies subtotal: total players Number of low endowment players Average investment
22 T2: Heterogeneity & weak sanctions sanctions Weak sanctions and the effect of a reference point on efficiency outcomes: Match 2 weak sanctions parameter changes don t t affect predicted Nash for low or high endowment players Subjects are provided at least one reference point a a limit of 9 is 9 imposed which players are free to abide by or to ignore Play of low endowment subjects moves closer to predicted Nash
23 T2: Heterogeneity & weak sanctions sanctions Weak sanctions a reference point?: large number of choices at Nash Distribution of Public Investment Choices, Match 2 low endowment players high endowment players Equal to limit of 9 below Nash (and not = 9) at Nash* above Nash total choices % 70.8% % 32.0% 5.5% 33.0% 400 * Nash equilibrium for low endowment players is equal to 8 and is equal to 16 for high endowment players
24 T1: Heterogeneity & no-rules Outcome: Information on the limit appears to influence the strategy of low endowment players Public Investment Choices for Low Endowment Players, Match 2 below Nash (8 or more times) at Nash (8 or more times) other strategies subtotal: total players Number of low endowment players
25 T2: Heterogeneity & weak sanctions sanctions Figure 3. Average Investment in the Common Property Resource Across Matches, Low and High Endowment Subjects Mean Public Investment Low Endowment High Endowment
26 T2: Heterogeneity & weak sanctions sanctions Efficiency outcomes under weak sanctions: Under weak sanctions, efficiency improves Earnings inequality between subject types declines Actual as a Share of PO (low endowment players (8 tokens)) Actual as a Share of PO (high endowment players (24 tokens)) Actual as a Share of PO (average) Casari Plott Ostrom, Walker Gardner T1 - No Sanctions 35.1 % 84.2 % 59.7 % 28.4%* -3.2% T2 - Weak Sanctions 46.2% 78.5% 62.4% 48.3% 6.5%
27 T3: Heterogeneity & stronger sanctions sanctions Stronger Sanctions: Under stronger sanctions predicted Nash decreases for high endowment endowment subjects (14) and does not change for low endowment subjects Sanctions are weak relative to Casari and Plott (2003) Low and high endowment players reduce investment in public good
28 T3: Heterogeneity & stronger sanctions sanctions Figure 3. Average Investment in the Common Property Resource Across Matches, Low and High Endowment Subjects Mean Public Investment Low Endowment High Endowment
29 T3: Heterogeneity & stronger sanctions sanctions Share of low endowment players playing at Nash falls to 53 from 71 (still greater than T1) Share of high endowment players at or above Nash nearly constant % to 41% Distribution of Public Investment Choices, Match 3 low endowment high endowment at limit of % 26.0% below Nash (and not = 5) 28.0% 32.5% at Nash* 52.8% 2.3% above Nash (and not = 24) 20.0% at % total choices average *with stronger sanctions, Nash for low endowment subjects remains at 8 and falls to 14 for high endowment subjects
30 T3: Heterogeneity & stronger sanctions sanctions Stronger Sanctions: efficiency improvements and earnings inequality declines No Sanctions Weak Sanctions Stronger Sanctions Actual as a Share of PO (low endowment players (8 tokens)) 35.1 % 46.2% 64.2 % Actual as a Share of PO (high endowment players (24 tokens)) 84.2 % 78.5% 88.2% Actual as a Share of PO (average) 59.7 % 62.4% 76.2% Casari Plott 28.4%* 48.3% 76.9% Ostrom, Walker Gardner -3.2% 6.5%
31 T4: Heterogeneity, Stronger Sanctions and Endowment Switch Endowment Switch: High endowment players increase average investment to levels similar to no- rules environment environment (avg to 15.6) play beyond predicted Nash Low endowment players average investment relatively constant (avg. 6.6 to 6.4) Anticipated (7 sessions) and Unanticipated (3 sessions)
32 T4: Heterogeneity, Stronger Sanctions and Endowment Switch Figure 3. Average Investment in the Common Property Resource Across Matches, Low and High Endowment Subjects Mean Public Investment Low Endowment High Endowment
33 T4: Heterogeneity, Stronger Sanctions and Endowment Switch Endowment Switch: No Sanctions Weak Sanctions Stronger Sanctions Stronger Sanctions Switch Actual as a Share of PO (low endowment players (8 tokens)) 35.1 % 46.2% 64.2 % 47.8% Actual as a Share of PO (high endowment players (24 tokens)) 84.2 % 78.5% 88.2% 71.6% Actual as a Share of PO (average) 59.7 % 62.4% 76.2% 59.7% Casari Plott 28.4%* 48.3% 76.9% Ostrom, Walker Gardner -3.2% 6.5%
34 T4: Heterogeneity, Stronger Sanctions and Endowment Switch Endowment Switch: With prior information fewer extreme investments (at 24) but about the same number at or above Nash Overall, prior information appears to not to affect efficiency outcomes (or to change efficiency in an unexpected direction) Distribution of Public Investment Choices by Information, High Endowment Players, Match 4 at limit of 5 below Nash (and not = 5) at Nash* 15 to total choices No information on endowment switch 11.8% 26.8% 2.5% 28.9% 30.0% 280 Prior information on endowment switch 15.0% 20.0% 4.2% 40.8% 20.0% 120 *with stronger sanctions, Nash for low endowment subjects remains at 8 and falls to 14 for high endowment subjects
35 T4: Heterogeneity, Stronger Sanctions and Endowment Switch Endowment Switch: Across all treatments, average investment is about equal with and without information for subject initially assigned low endowments Public Investment for players initially assigned low endowments Match 1 Match 2 Match 3 Match 4 Average No Prior Information Prior Information
36 T4: Heterogeneity, Stronger Sanctions and Endowment Switch Endowment Switch: Consequently, efficiency earnings are about the same with greater information for subjects initially assigned low endowments Efficiency outcomes for players initially assigned low endowments Match 1 Match 2 Match 3 Match 4 Average No Prior Information Prior Information
37 Conclusion T1-No Rules Environment: Actual efficiency exceeds predicted Nash efficiency and efficiency outcomes exceed those reported in other studies. Persistent under-investment by low endowment players seems to contribute to this outcome. Investment by low endowment players is bi-modally distributed Consequently, while differences in endowments appear to promote a relatively efficient group outcome overall earnings inequality increases.. Efficiency outcomes are greater than predicted for high endowment subjects and lower than predicted for low endowment subjects in the no no-rules environment.
38 Conclusion T2 - Weak Sanctions: the opportunity to monitor and sanction improves efficiency,, even when sanctions are designed in such a way as not to affect predicted Nash play. efficiency earnings especially increase for low endowment players and earnings inequality declines. a reference point (i.e. the limit) provided to low endowment subjects may account in part for observed efficiency improvements.
39 Conclusion T3 - Stronger Sanctions: Similar to results reported in other studies, stronger sanctions (those designed to change predicted Nash equilibrium), significantly improve efficiency. Efficiency earnings improve the most for low endowment subjects and earnings inequality declines further. The improvements we observe are achieved with relatively weak sanctions compared to Casari and Plott.
40 Conclusion T4 - Endowment Switch: much lower efficiency outcomes with the endowment switch. Even under strong sanctions, a sudden endowment switch results in efficiency outcomes similar to those in the no-rules or open access environment. Investment increases significantly for subjects gaining high endowment positions. additional information on the future endowment switch does not appear improve efficiency outcomes for players initially assigned low endowment positions.
41 Extensions and Future Research Run additional sessions with information (only 3 information sessions robust??) Directions for additional analysis Analyze monitoring and sanctioning behavior between subject types Explore notions of fairness in sanctioning and investment decisions Future Research Introduce risk to the CPR and or some level of uncertainty to the outside investment option to what extent is the CPR managed to smooth consumption Expand concept of heterogeneity beyond endowments Introduce a choice between types of property regimes
Self-Government and Public Goods: An Experiment
Self-Government and Public Goods: An Experiment Kenju Kamei and Louis Putterman Brown University Jean-Robert Tyran* University of Copenhagen * No blame for this draft. Centralized vs. Decentralized Sanctions
More informationDebt and (Future) Taxes: Financing Intergenerational Public Goods
Debt and (Future) Taxes: Financing Intergenerational Public Goods J. Forrest Williams Portland State University February 25, 2015 J. Forrest Williams (Portland State) Intergenerational Externalities &
More informationGame Theory. Wolfgang Frimmel. Repeated Games
Game Theory Wolfgang Frimmel Repeated Games 1 / 41 Recap: SPNE The solution concept for dynamic games with complete information is the subgame perfect Nash Equilibrium (SPNE) Selten (1965): A strategy
More informationGroup Size, Coordination, and the Effectiveness of Punishment in the Voluntary Contributions Mechanism: An Experimental Investigation
Games 2013, 4, 89-105; doi:10.3390/g4010089 OPEN ACCESS games ISSN 2073-4336 www.mdpi.com/journal/games Article Group Size, Coordination, and the Effectiveness of Punishment in the Voluntary Contributions
More informationProvision versus Appropriation in Symmetric and Asymmetric Social Dilemmas. James C. Cox, Elinor Ostrom, Vjollca Sadiraj, and James M.
Provision versus Appropriation in Symmetric and Asymmetric Social Dilemmas James C. Cox, Elinor Ostrom, Vjollca Sadiraj, and James M. Walker Much-studied Social Dilemmas for Symmetric Agents In a standard
More information6.254 : Game Theory with Engineering Applications Lecture 3: Strategic Form Games - Solution Concepts
6.254 : Game Theory with Engineering Applications Lecture 3: Strategic Form Games - Solution Concepts Asu Ozdaglar MIT February 9, 2010 1 Introduction Outline Review Examples of Pure Strategy Nash Equilibria
More informationDynamic Voluntary Contributions to Public Goods with Stock Accumulation. J. Cristobal Ruiz-Tagle. Department of Agricultural and Resource Economics,
Dynamic Voluntary Contributions to Public Goods with Stock Accumulation J. Cristobal Ruiz-Tagle Department of Agricultural and Resource Economics, University of Maryland, College Park jruiz-tagle@arec.umd.edu
More informationDeterring Poaching of a Common Pool Resource
Deterring Poaching of a Common Pool Resource Lawrence R. De Geest, John K. Stranlund, John M. Spraggon Department of Resource Economics, University of Massachusetts-Amherst, 80 Campus Center Way, Amherst
More informationPrisoner s dilemma with T = 1
REPEATED GAMES Overview Context: players (e.g., firms) interact with each other on an ongoing basis Concepts: repeated games, grim strategies Economic principle: repetition helps enforcing otherwise unenforceable
More informationEndogenous Minimum Participation in International Environmental Agreements: An Experimental Analysis
January 2014 Endogenous Minimum Participation in International Environmental Agreements: An Experimental Analysis David M. McEvoy (corresponding author) Department of Economics Appalachian State University
More informationJanuary 26,
January 26, 2015 Exercise 9 7.c.1, 7.d.1, 7.d.2, 8.b.1, 8.b.2, 8.b.3, 8.b.4,8.b.5, 8.d.1, 8.d.2 Example 10 There are two divisions of a firm (1 and 2) that would benefit from a research project conducted
More informationCUR 412: Game Theory and its Applications, Lecture 12
CUR 412: Game Theory and its Applications, Lecture 12 Prof. Ronaldo CARPIO May 24, 2016 Announcements Homework #4 is due next week. Review of Last Lecture In extensive games with imperfect information,
More informationPlaying games with transmissible animal disease. Jonathan Cave Research Interest Group 6 May 2008
Playing games with transmissible animal disease Jonathan Cave Research Interest Group 6 May 2008 Outline The nexus of game theory and epidemiology Some simple disease control games A vaccination game with
More informationSuggested solutions to the 6 th seminar, ECON4260
1 Suggested solutions to the 6 th seminar, ECON4260 Problem 1 a) What is a public good game? See, for example, Camerer (2003), Fehr and Schmidt (1999) p.836, and/or lecture notes, lecture 1 of Topic 3.
More informationMicroeconomic Theory May 2013 Applied Economics. Ph.D. PRELIMINARY EXAMINATION MICROECONOMIC THEORY. Applied Economics Graduate Program.
Ph.D. PRELIMINARY EXAMINATION MICROECONOMIC THEORY Applied Economics Graduate Program May 2013 *********************************************** COVER SHEET ***********************************************
More informationOveruse of a Common Resource: A Two-player Example
Overuse of a Common Resource: A Two-player Example There are two fishermen who fish a common fishing ground a lake, for example Each can choose either x i = 1 (light fishing; for example, use one boat),
More informationEC202. Microeconomic Principles II. Summer 2009 examination. 2008/2009 syllabus
Summer 2009 examination EC202 Microeconomic Principles II 2008/2009 syllabus Instructions to candidates Time allowed: 3 hours. This paper contains nine questions in three sections. Answer question one
More informationVoluntary Public Goods Provision, Coalition Formation, and Uncertainty 1. Nicholas E. Burger Charles D. Kolstad
Voluntary Public Goods Provision, Coalition Formation, and Uncertainty 1 Nicholas E. Burger Charles D. Kolstad University of California, Santa Barbara March, 2008 Abstract There is extensive empirical
More informationPh.D. Preliminary Examination MICROECONOMIC THEORY Applied Economics Graduate Program June 2015
Ph.D. Preliminary Examination MICROECONOMIC THEORY Applied Economics Graduate Program June 2015 The time limit for this exam is four hours. The exam has four sections. Each section includes two questions.
More informationExperimental Evidence of Bank Runs as Pure Coordination Failures
Experimental Evidence of Bank Runs as Pure Coordination Failures Jasmina Arifovic (Simon Fraser) Janet Hua Jiang (Bank of Canada and U of Manitoba) Yiping Xu (U of International Business and Economics)
More informationInvesting in Institutions for Cooperation
Investing in Institutions for Cooperation A Major Qualifying Project Report Submitted to the Faculty of Worcester Polytechnic Institute In Partial Fulfillment of the Requirements for the Degree of Bachelor
More informationProblem 3 Solutions. l 3 r, 1
. Economic Applications of Game Theory Fall 00 TA: Youngjin Hwang Problem 3 Solutions. (a) There are three subgames: [A] the subgame starting from Player s decision node after Player s choice of P; [B]
More informationFull terms and conditions of use:
This article was downloaded by: [148.251.232.83] On: 08 October 2018, At: 18:25 Publisher: Institute for Operations Research and the Management Sciences (INFORMS) INFORMS is located in Maryland, USA Management
More informationExtensive Form Games II
Extensive Form Games II Trembling Hand Perfection Selten Game (-1,-1) (2,0) L R 2 U 1 D (1,1) L R U -1,-1 2,0 D 1,1 1,1 subgame perfect equilibria: UR is subgame perfect D and.5 or more L is Nash but not
More informationMicroeconomics II. CIDE, MsC Economics. List of Problems
Microeconomics II CIDE, MsC Economics List of Problems 1. There are three people, Amy (A), Bart (B) and Chris (C): A and B have hats. These three people are arranged in a room so that B can see everything
More informationCUR 412: Game Theory and its Applications Final Exam Ronaldo Carpio Jan. 13, 2015
CUR 41: Game Theory and its Applications Final Exam Ronaldo Carpio Jan. 13, 015 Instructions: Please write your name in English. This exam is closed-book. Total time: 10 minutes. There are 4 questions,
More informationLecture 6 Dynamic games with imperfect information
Lecture 6 Dynamic games with imperfect information Backward Induction in dynamic games of imperfect information We start at the end of the trees first find the Nash equilibrium (NE) of the last subgame
More informationAn introduction on game theory for wireless networking [1]
An introduction on game theory for wireless networking [1] Ning Zhang 14 May, 2012 [1] Game Theory in Wireless Networks: A Tutorial 1 Roadmap 1 Introduction 2 Static games 3 Extensive-form games 4 Summary
More informationChapter 11: Network Models of Markets with Intermediaries. Presented by Vladislava Arabadzhieva
Chapter 11: Network Models of Markets with Intermediaries Presented by Vladislava Arabadzhieva 1 Contents 11.1 Price-Setting in Markets 11.2 A Model of Trade on Networks 11.3 Equilibria in Trading Networks
More informationCS 331: Artificial Intelligence Game Theory I. Prisoner s Dilemma
CS 331: Artificial Intelligence Game Theory I 1 Prisoner s Dilemma You and your partner have both been caught red handed near the scene of a burglary. Both of you have been brought to the police station,
More informationChapter 7 Review questions
Chapter 7 Review questions 71 What is the Nash equilibrium in a dictator game? What about the trust game and ultimatum game? Be careful to distinguish sub game perfect Nash equilibria from other Nash equilibria
More informationAre dyads conditionally cooperative? Evidence from a public goods experiment
MPRA Munich Personal RePEc Archive Are dyads conditionally cooperative? Evidence from a public goods experiment Andrea Morone and Tiziana Temerario Università degli Studi di Bari Aldo Moro, Italy October
More informationG5212: Game Theory. Mark Dean. Spring 2017
G5212: Game Theory Mark Dean Spring 2017 What is Missing? So far we have formally covered Static Games of Complete Information Dynamic Games of Complete Information Static Games of Incomplete Information
More informationIntroduction to Game Theory Lecture Note 5: Repeated Games
Introduction to Game Theory Lecture Note 5: Repeated Games Haifeng Huang University of California, Merced Repeated games Repeated games: given a simultaneous-move game G, a repeated game of G is an extensive
More informationGame Theory. Analyzing Games: From Optimality to Equilibrium. Manar Mohaisen Department of EEC Engineering
Game Theory Analyzing Games: From Optimality to Equilibrium Manar Mohaisen Department of EEC Engineering Korea University of Technology and Education (KUT) Content Optimality Best Response Domination Nash
More informationMA200.2 Game Theory II, LSE
MA200.2 Game Theory II, LSE Problem Set 1 These questions will go over basic game-theoretic concepts and some applications. homework is due during class on week 4. This [1] In this problem (see Fudenberg-Tirole
More informationMA300.2 Game Theory 2005, LSE
MA300.2 Game Theory 2005, LSE Answers to Problem Set 2 [1] (a) This is standard (we have even done it in class). The one-shot Cournot outputs can be computed to be A/3, while the payoff to each firm can
More informationECON 803: MICROECONOMIC THEORY II Arthur J. Robson Fall 2016 Assignment 9 (due in class on November 22)
ECON 803: MICROECONOMIC THEORY II Arthur J. Robson all 2016 Assignment 9 (due in class on November 22) 1. Critique of subgame perfection. 1 Consider the following three-player sequential game. In the first
More informationPrisoner s Dilemma. CS 331: Artificial Intelligence Game Theory I. Prisoner s Dilemma. Prisoner s Dilemma. Prisoner s Dilemma.
CS 331: rtificial Intelligence Game Theory I You and your partner have both been caught red handed near the scene of a burglary. oth of you have been brought to the police station, where you are interrogated
More informationMicroeconomic Theory August 2013 Applied Economics. Ph.D. PRELIMINARY EXAMINATION MICROECONOMIC THEORY. Applied Economics Graduate Program
Ph.D. PRELIMINARY EXAMINATION MICROECONOMIC THEORY Applied Economics Graduate Program August 2013 The time limit for this exam is four hours. The exam has four sections. Each section includes two questions.
More informationGeneral Examination in Microeconomic Theory SPRING 2014
HARVARD UNIVERSITY DEPARTMENT OF ECONOMICS General Examination in Microeconomic Theory SPRING 2014 You have FOUR hours. Answer all questions Those taking the FINAL have THREE hours Part A (Glaeser): 55
More informationCMPSCI 240: Reasoning about Uncertainty
CMPSCI 240: Reasoning about Uncertainty Lecture 23: More Game Theory Andrew McGregor University of Massachusetts Last Compiled: April 20, 2017 Outline 1 Game Theory 2 Non Zero-Sum Games and Nash Equilibrium
More informationEndowment inequality in public goods games: A re-examination by Shaun P. Hargreaves Heap* Abhijit Ramalingam** Brock V.
CBESS Discussion Paper 16-10 Endowment inequality in public goods games: A re-examination by Shaun P. Hargreaves Heap* Abhijit Ramalingam** Brock V. Stoddard*** *King s College London **School of Economics
More informationSequential-move games with Nature s moves.
Econ 221 Fall, 2018 Li, Hao UBC CHAPTER 3. GAMES WITH SEQUENTIAL MOVES Game trees. Sequential-move games with finite number of decision notes. Sequential-move games with Nature s moves. 1 Strategies in
More informationRisk Aversion and Tacit Collusion in a Bertrand Duopoly Experiment
Risk Aversion and Tacit Collusion in a Bertrand Duopoly Experiment Lisa R. Anderson College of William and Mary Department of Economics Williamsburg, VA 23187 lisa.anderson@wm.edu Beth A. Freeborn College
More informationStatic and Dynamic Underinvestment: An Experimental Investigation
Static and Dynamic Underinvestment: An Experimental Investigation Marina Agranov Caltech Guillaume Fréchette NYU Thomas Palfrey Caltech Emanuel Vespa UCSB August 26, 2016 Abstract In this paper, we analyze
More informationIterated Dominance and Nash Equilibrium
Chapter 11 Iterated Dominance and Nash Equilibrium In the previous chapter we examined simultaneous move games in which each player had a dominant strategy; the Prisoner s Dilemma game was one example.
More informationState or Nature? Formal vs. Informal Sanctioning in the Voluntary Provision of Public Goods *
State or Nature? Formal vs. Informal Sanctioning in the Voluntary Provision of Public Goods * Kenju Kamei a, Louis Putterman a and Jean-Robert Tyran b a Department of Economics, Brown University, Providence,
More informationZwick Center for Food and Resource Policy Working Paper Series No. 5
Zwick Center for Food and Resource Policy Working Paper Series No. 5 Assessing a Provision Game for Two Units of a Public Good, With Different Group Arrangements, Marginal Benefits, and Rebate Rules: Experimental
More informationFinitely repeated simultaneous move game.
Finitely repeated simultaneous move game. Consider a normal form game (simultaneous move game) Γ N which is played repeatedly for a finite (T )number of times. The normal form game which is played repeatedly
More informationIPR Protection in the High-Tech Industries: A Model of Piracy. Thierry Rayna University of Bristol
IPR Protection in the High-Tech Industries: A Model of Piracy Thierry Rayna University of Bristol thierry.rayna@bris.ac.uk Digital Goods Are Public, Aren t They? For digital goods to be non-rival, copy
More informationHomework #2 Psychology 101 Spr 03 Prof Colin Camerer
Homework #2 Psychology 101 Spr 03 Prof Colin Camerer This is available Monday 28 April at 130 (in class or from Karen in Baxter 332, or on web) and due Wednesday 7 May at 130 (in class or to Karen). Collaboration
More informationMath 135: Answers to Practice Problems
Math 35: Answers to Practice Problems Answers to problems from the textbook: Many of the problems from the textbook have answers in the back of the book. Here are the answers to the problems that don t
More informationAdvanced Microeconomics
Advanced Microeconomics ECON5200 - Fall 2014 Introduction What you have done: - consumers maximize their utility subject to budget constraints and firms maximize their profits given technology and market
More informationEndogenous Shifts Over Time in Patterns of Contributions in Public Good Games
Endogenous Shifts Over Time in Patterns of Contributions in Public Good Games Sun-Ki Chai Dolgorsuren Dorj Ming Liu January 8, 2009 Abstract This paper studies endogenous preference change over time in
More informationOther Regarding Preferences
Other Regarding Preferences Mark Dean Lecture Notes for Spring 015 Behavioral Economics - Brown University 1 Lecture 1 We are now going to introduce two models of other regarding preferences, and think
More informationRepeated Games. Econ 400. University of Notre Dame. Econ 400 (ND) Repeated Games 1 / 48
Repeated Games Econ 400 University of Notre Dame Econ 400 (ND) Repeated Games 1 / 48 Relationships and Long-Lived Institutions Business (and personal) relationships: Being caught cheating leads to punishment
More informationCUR 412: Game Theory and its Applications, Lecture 9
CUR 412: Game Theory and its Applications, Lecture 9 Prof. Ronaldo CARPIO May 22, 2015 Announcements HW #3 is due next week. Ch. 6.1: Ultimatum Game This is a simple game that can model a very simplified
More informationGame Theory Fall 2003
Game Theory Fall 2003 Problem Set 5 [1] Consider an infinitely repeated game with a finite number of actions for each player and a common discount factor δ. Prove that if δ is close enough to zero then
More informationPh.D. Preliminary Examination MICROECONOMIC THEORY Applied Economics Graduate Program August 2017
Ph.D. Preliminary Examination MICROECONOMIC THEORY Applied Economics Graduate Program August 2017 The time limit for this exam is four hours. The exam has four sections. Each section includes two questions.
More informationDevelopment Economics
Development Economics Development Microeconomics (by) Bardhan and Udry Chapter 7 Rural credit markets [1] Importance Smoothing consumption in an environment where production is risky and insurance markets
More informationCooperative Game Theory
Cooperative Game Theory Non-cooperative game theory specifies the strategic structure of an interaction: The participants (players) in a strategic interaction Who can do what and when, and what they know
More informationAnnouncement, Observation, and Honesty in the Voluntary Contributions Game
Announcement, Observation, and Honesty in the Voluntary Contributions Game By Laurent Denant-Boemont, David Masclet and Charles Noussair January, 2005 Abstract In this paper, we study the effect of announcement
More informationpreferences of the individual players over these possible outcomes, typically measured by a utility or payoff function.
Leigh Tesfatsion 26 January 2009 Game Theory: Basic Concepts and Terminology A GAME consists of: a collection of decision-makers, called players; the possible information states of each player at each
More informationGame Theory. Important Instructions
Prof. Dr. Anke Gerber Game Theory 2. Exam Summer Term 2012 Important Instructions 1. There are 90 points on this 90 minutes exam. 2. You are not allowed to use any material (books, lecture notes etc.).
More informationDynamic games with incomplete information
Dynamic games with incomplete information Perfect Bayesian Equilibrium (PBE) We have now covered static and dynamic games of complete information and static games of incomplete information. The next step
More informationEconomics 209A Theory and Application of Non-Cooperative Games (Fall 2013) Repeated games OR 8 and 9, and FT 5
Economics 209A Theory and Application of Non-Cooperative Games (Fall 2013) Repeated games OR 8 and 9, and FT 5 The basic idea prisoner s dilemma The prisoner s dilemma game with one-shot payoffs 2 2 0
More informationMicroeconomics of Banking: Lecture 5
Microeconomics of Banking: Lecture 5 Prof. Ronaldo CARPIO Oct. 23, 2015 Administrative Stuff Homework 2 is due next week. Due to the change in material covered, I have decided to change the grading system
More informationFinancial Fragility A Global-Games Approach Itay Goldstein Wharton School, University of Pennsylvania
Financial Fragility A Global-Games Approach Itay Goldstein Wharton School, University of Pennsylvania Financial Fragility and Coordination Failures What makes financial systems fragile? What causes crises
More informationLecture 5 Leadership and Reputation
Lecture 5 Leadership and Reputation Reputations arise in situations where there is an element of repetition, and also where coordination between players is possible. One definition of leadership is that
More informationNetworks: Fall 2010 Homework 3 David Easley and Jon Kleinberg Due in Class September 29, 2010
Networks: Fall 00 Homework David Easley and Jon Kleinberg Due in Class September 9, 00 As noted on the course home page, homework solutions must be submitted by upload to the CMS site, at https://cms.csuglab.cornell.edu/.
More informationIV. Cooperation & Competition
IV. Cooperation & Competition Game Theory and the Iterated Prisoner s Dilemma 10/15/03 1 The Rudiments of Game Theory 10/15/03 2 Leibniz on Game Theory Games combining chance and skill give the best representation
More informationSeeds to Succeed? Sequential Giving to Public Projects 1
Seeds to Succeed? Sequential Giving to Public Projects 1 Anat Bracha Tel Aviv University Michael Menietti University of Pittsburgh Lise Vesterlund University of Pittsburgh Abstract The public phase of
More informationCMSC 474, Introduction to Game Theory 16. Behavioral vs. Mixed Strategies
CMSC 474, Introduction to Game Theory 16. Behavioral vs. Mixed Strategies Mohammad T. Hajiaghayi University of Maryland Behavioral Strategies In imperfect-information extensive-form games, we can define
More informationCoordination Problems
Coordination Problems 1 / 32 Outline Some Simple Coordination Games Coordination Traps Coordination Failures 2 / 32 A Simple Coordination Game: What Side of the Street? Driver 2 L R Driver 1 l 5, 5 0,
More informationSeeds to Succeed: Sequential Giving to Public Projects
Seeds to Succeed: Sequential Giving to Public Projects Anat Bracha, Michael Menietti, and Lise Vesterlund No. 09 21 Abstract: The public phase of a capital campaign is typically launched with the announcement
More information13.1 Infinitely Repeated Cournot Oligopoly
Chapter 13 Application: Implicit Cartels This chapter discusses many important subgame-perfect equilibrium strategies in optimal cartel, using the linear Cournot oligopoly as the stage game. For game theory
More informationCoordination Problems
Coordination Problems 1 / 32 A Simple Coordination Game: What Side of the Street? Driver 2 L R Driver 1 l 5, 5 0, 0 r 0, 0 5, 5 Two equilibria: (l, L) and (r, R) Pure coordination game drivers care only
More informationAGGREGATE IMPLICATIONS OF WEALTH REDISTRIBUTION: THE CASE OF INFLATION
AGGREGATE IMPLICATIONS OF WEALTH REDISTRIBUTION: THE CASE OF INFLATION Matthias Doepke University of California, Los Angeles Martin Schneider New York University and Federal Reserve Bank of Minneapolis
More informationEC 202. Lecture notes 14 Oligopoly I. George Symeonidis
EC 202 Lecture notes 14 Oligopoly I George Symeonidis Oligopoly When only a small number of firms compete in the same market, each firm has some market power. Moreover, their interactions cannot be ignored.
More informationProblem Set 1. Debraj Ray Economic Development, Fall 2002
Debraj Ray Economic Development, Fall 2002 Problem Set 1 You will benefit from doing these problems, but there is no need to hand them in. If you want more discussion in class on these problems, I will
More informationFinite Memory and Imperfect Monitoring
Federal Reserve Bank of Minneapolis Research Department Finite Memory and Imperfect Monitoring Harold L. Cole and Narayana Kocherlakota Working Paper 604 September 2000 Cole: U.C.L.A. and Federal Reserve
More informationMicroeconomic Theory II Preliminary Examination Solutions
Microeconomic Theory II Preliminary Examination Solutions 1. (45 points) Consider the following normal form game played by Bruce and Sheila: L Sheila R T 1, 0 3, 3 Bruce M 1, x 0, 0 B 0, 0 4, 1 (a) Suppose
More informationOstracism and the Provision of a Public Good Experimental Evidence
Preprints of the Max Planck Institute for Research on Collective Goods Bonn 2005/24 Ostracism and the Provision of a Public Good Experimental Evidence Frank P. Maier-Rigaud Peter Martinsson Gianandrea
More informationPayoff Scale Effects and Risk Preference Under Real and Hypothetical Conditions
Payoff Scale Effects and Risk Preference Under Real and Hypothetical Conditions Susan K. Laury and Charles A. Holt Prepared for the Handbook of Experimental Economics Results February 2002 I. Introduction
More informationThe Clock-Proxy Auction: A Practical Combinatorial Auction Design
The Clock-Proxy Auction: A Practical Combinatorial Auction Design Lawrence M. Ausubel, Peter Cramton, Paul Milgrom University of Maryland and Stanford University Introduction Many related (divisible) goods
More informationAUCTIONEER ESTIMATES AND CREDULOUS BUYERS REVISITED. November Preliminary, comments welcome.
AUCTIONEER ESTIMATES AND CREDULOUS BUYERS REVISITED Alex Gershkov and Flavio Toxvaerd November 2004. Preliminary, comments welcome. Abstract. This paper revisits recent empirical research on buyer credulity
More informationWeek 8: Basic concepts in game theory
Week 8: Basic concepts in game theory Part 1: Examples of games We introduce here the basic objects involved in game theory. To specify a game ones gives The players. The set of all possible strategies
More informationDuopoly models Multistage games with observed actions Subgame perfect equilibrium Extensive form of a game Two-stage prisoner s dilemma
Recap Last class (September 20, 2016) Duopoly models Multistage games with observed actions Subgame perfect equilibrium Extensive form of a game Two-stage prisoner s dilemma Today (October 13, 2016) Finitely
More information1 Two Period Exchange Economy
University of British Columbia Department of Economics, Macroeconomics (Econ 502) Prof. Amartya Lahiri Handout # 2 1 Two Period Exchange Economy We shall start our exploration of dynamic economies with
More informationTHE PENNSYLVANIA STATE UNIVERSITY. Department of Economics. January Written Portion of the Comprehensive Examination for
THE PENNSYLVANIA STATE UNIVERSITY Department of Economics January 2014 Written Portion of the Comprehensive Examination for the Degree of Doctor of Philosophy MICROECONOMIC THEORY Instructions: This examination
More informationDepartment of Economics Working Paper WP April 2012
Department of Economics Working Paper WP 2012-01 April 2012 Sharing as Risk Pooling in a Social Dilemma Experiment Todd Cherry Appalachian State University E. Lance Howe University of Alaska Anchorage
More informationCould climate change liability help to strike a climate agreement?: An economic experiment
Could climate change liability help to strike a climate agreement?: An economic experiment Elisabeth Gsottbauer USF, Osnabrück & EURAC, Bozen Joint work with Robert Gampfer, Elizabeth Bernold and Anna-Mateja
More informationNow we return to simultaneous-move games. We resolve the issue of non-existence of Nash equilibrium. in pure strategies through intentional mixing.
Econ 221 Fall, 2018 Li, Hao UBC CHAPTER 7. SIMULTANEOUS-MOVE GAMES: MIXED STRATEGIES Now we return to simultaneous-move games. We resolve the issue of non-existence of Nash equilibrium in pure strategies
More informationAn Experimental Test of Risk-Sharing Arrangements. Gary Charness. Garance Genicot
An Experimental Test of Risk-Sharing Arrangements Gary Charness University of California, Santa Barbara Garance Genicot Georgetown University November 2003. Very Preliminary ABSTRACT This project investigates
More informationINCENTIVES IN PUBLIC GOODS EXPERIMENTS: IMPLICATIONS FOR THE ENVIRONMENT
INCENTIVES IN PUBLIC GOODS EXPERIMENTS: IMPLICATIONS FOR THE ENVIRONMENT Jacob K. Goeree and Charles A. Holt University of Virginia Susan K. Laury * Georgia State University January Abstract: This paper
More informationCREE. Voluntary contributions to bargaining: hold-up problem in the lab. Working Paper 08/2016. A. Ciccone
CREE Working Paper 08/2016 Voluntary contributions to bargaining: hold-up problem in the lab A. Ciccone The CREE Centre acknowledges financial support from The Research Council of Norway, University of
More informationFINANCING OF PUBLIC GOODS THROUGH TAXATION IN A GENERAL EQUILIBRIUM ECONOMY: EXPERIMENTAL EVIDENCE. Juergen Huber, Martin Shubik, and Shyam Sunder
FINANCING OF PUBLIC GOODS THROUGH TAXATION IN A GENERAL EQUILIBRIUM ECONOMY: EXPERIMENTAL EVIDENCE By Juergen Huber, Martin Shubik, and Shyam Sunder October 2011 Revised April 2013 COWLES FOUNDATION DISCUSSION
More informationNoncooperative Oligopoly
Noncooperative Oligopoly Oligopoly: interaction among small number of firms Conflict of interest: Each firm maximizes its own profits, but... Firm j s actions affect firm i s profits Example: price war
More informationUC Berkeley Haas School of Business Game Theory (EMBA 296 & EWMBA 211) Summer 2016
UC Berkeley Haas School of Business Game Theory (EMBA 296 & EWMBA 211) Summer 2016 More on strategic games and extensive games with perfect information Block 2 Jun 11, 2017 Auctions results Histogram of
More information