|
Field
Abstract
|
Before
Repeated games with a long-lived player facing a sequence of short-lived players has, sins these
games were first studied in Fudenberg and Levine (1989), been the focus of much theoretical work. In more recent years these models have received much attention due to their application to trade on online platforms such as Ebay and Amazon (which is becoming increasingly important). Like
the more studied case of two long-lived players, the case with one long-lived player also suffers from
multiplicity. Thus, while it is clear from a theoretical perspective that repeated interactions can
help long-lived and short-lived players coordinate on mutually beneficial outcomes, it is unclear
how this will come about.
We set out to experimentally study strategy choices in repeated games with long-lived and short
lived players by running a series of lab experiments. Our perspective is on the role of commitment
types in this framework. That is, to what extent the presence of commitment types help coordi-
nation towards beneficial outcomes. From a theoretical perspective, commitment types will help
long-lived and short-lived players to coordinate on beneficial outcomes by excluding equilibria in
which cooperation never takes pace.
We implement the model of reputational concerns introduced by Fudenberg and Levine (1989,
1992), which has become a workhorse model in the theoretical work on situations with reputational
concerns. In the model, a long-lived player interacts with an infinite sequence of short-lived players.
The long-lived player has a commitment types and short-lived players observe the complete history
of play. Despite the vast theoretical literature, the experimental evidence on infinitely repeated
games building on the paradigm of Fudenberg and Levine (1989, 1992) is scarce. The environments
with a long-lived player facing a sequence of short lived players has been studied in experiments
before, this has been in setting with finite horizons. Thus, to our knowledge we are the first to take
the model of Fudenberg and Levine (1989) to the lab.
|
After
Repeated games with a long-lived player facing a sequence of short-lived players has, sins these
games were first studied in Fudenberg and Levine (1989), been the focus of much theoretical work. In more recent years these models have received much attention due to their application to trade on online platforms such as Ebay and Amazon (which is becoming increasingly important). Like the more studied case of two long-lived players, the case with one long-lived player also suffers from
multiplicity. Thus, while it is clear from a theoretical perspective that repeated interactions can
help long-lived and short-lived players coordinate on mutually beneficial outcomes, it is unclear
how this will come about.
We set out to experimentally study strategy choices in repeated games with long-lived and short
lived players by running a series of lab experiments. Our perspective is on the role of commitment
types in this framework. That is, to what extent the presence of commitment types help coordi-
nation towards beneficial outcomes. From a theoretical perspective, commitment types will help
long-lived and short-lived players to coordinate on beneficial outcomes by excluding equilibria in
which cooperation never takes pace.
We implement the model of reputational concerns introduced by Fudenberg and Levine (1989,
1992), which has become a workhorse model in the theoretical work on situations with reputational
concerns. In the model, a long-lived player interacts with an infinite sequence of short-lived players.
The long-lived player has a commitment types and short-lived players observe the complete history
of play. Despite the vast theoretical literature, the experimental evidence on infinitely repeated
games building on the paradigm of Fudenberg and Levine (1989, 1992) is scarce. The environments
with a long-lived player facing a sequence of short lived players has been studied in experiments
before, this has been in setting with finite horizons. Thus, to our knowledge we are the first to take
the model of Fudenberg and Levine (1989) to the lab.
|
|
Field
Intervention (Public)
|
Before
The aim of the experiment is to empirically investigate the effect of commitment types in a repeated game where the long-lived player faces a trade-off between short-run and long run gains, and where the efficient outcome is an equilibrium. However, as it is only one of many, it requires that players coordinate. We hypothesis that the presence of a commit types will facilitate this coordination.
Our plan is to run two different treatments: One without commitment types, and one with commitment types. Commitment types are induced by way of computerized long-lived players who always chooses a specific action.
|
After
The aim of the experiment is to empirically investigate the effect of commitment types in a repeated game where the long-lived player faces a trade-off between short-run and long run gains, and where the efficient outcome is an equilibrium. However, as it is only one of many, it requires that players coordinate. We hypothesis that the presence of a commit types will facilitate this coordination.
Our plan is to run two different treatments: One without commitment types, and one with commitment types. Commitment types are induced by way of computerized long-lived players who always chooses a specific action.
In addition we run a control treatment where both players are short lived. This treatment will save as a empirical benchmark.
|