Efficiency, Reciprocity and Expectations in an Experimental Game

M. Dufwenberg, U. Gneezy

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Abstract

We experimentally investigate the nature of strategic interaction in a 2-player game.Player 1may take x Dutch guilders (f x) and end the game (player 2 then gets f 0), or let player 2 split f 20 between the players. x is a treatment variable taking values of f 4, 7, 10, 13, and 16.We find that most players 2 "give away" positive amounts (f6 on average), but their choices are independent of x.We explicitly measure the players' beliefs and find that many players 1 expect to get back no more than f x but nevertheless let player 2 split the f 20, and that the behavior by the players 2 is consistent with a theory of a guilt based on psychological game theory.
Original languageEnglish
Place of PublicationTilburg
PublisherMicroeconomics
Number of pages20
Volume1996-79
Publication statusPublished - 1996

Publication series

NameCentER Discussion Paper
Volume1996-79

Keywords

  • game theory

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