Pub Date : 2025-10-01Epub Date: 2025-05-30DOI: 10.1016/j.geb.2025.05.009
Austin Brooksby , Jacob Meyer , Lucas Rentschler , Vernon Smith , Robbie Spofford
Smith and Wilson (2018) argue that behavior in the ultimatum game may be due to the typical implementation, in which players are not given the opportunity to opt out of the game. Using insights from Smith (1759), they suggest that making play voluntary would increase rates of equilibrium play. They conducted an augmented ultimatum game where the responder first decides whether to participate, and compare their experimental data to stylized facts from the literature, reporting “far higher rates of equilibrium play...than heretofore reported”. However, they do not run standard versions of the ultimatum game as a control. To ensure their interpretation is warranted, we conducted experiments of both their augmented game and an analogous standard ultimatum game. In our data, rates of equilibrium play were not higher in the augmented game. Thus, we find no support for the primary conclusion of Smith and Wilson (2018).
{"title":"“Equilibrium play in voluntary ultimatum games: Beneficence cannot be extorted” - Comment","authors":"Austin Brooksby , Jacob Meyer , Lucas Rentschler , Vernon Smith , Robbie Spofford","doi":"10.1016/j.geb.2025.05.009","DOIUrl":"10.1016/j.geb.2025.05.009","url":null,"abstract":"<div><div><span><span>Smith and Wilson (2018)</span></span> argue that behavior in the ultimatum game may be due to the typical implementation, in which players are not given the opportunity to opt out of the game. Using insights from <span><span>Smith (1759)</span></span>, they suggest that making play voluntary would increase rates of equilibrium play. They conducted an augmented ultimatum game where the responder first decides whether to participate, and compare their experimental data to stylized facts from the literature, reporting “far higher rates of equilibrium play...than heretofore reported”. However, they do not run standard versions of the ultimatum game as a control. To ensure their interpretation is warranted, we conducted experiments of both their augmented game and an analogous standard ultimatum game. In our data, rates of equilibrium play were not higher in the augmented game. Thus, we find no support for the primary conclusion of <span><span>Smith and Wilson (2018)</span></span>.</div></div>","PeriodicalId":48291,"journal":{"name":"Games and Economic Behavior","volume":"153 ","pages":"Pages 67-93"},"PeriodicalIF":1.0,"publicationDate":"2025-10-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"144254384","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-10-01Epub Date: 2025-08-18DOI: 10.1016/j.geb.2025.08.006
Petros G. Sekeris
In this article we explore how propaganda relates to conflict initiation. In the presence of propaganda, if conflict is highly destructive, parties invest in armaments to improve their share of the pie at the negotiation table. If conflict is lowly destructive, peace is never reached and arming is implemented to boost the troops' morale and fighting efficiency. For intermediate destruction levels, the game only admits mixed strategy equilibria where peace and conflict occur probabilistically. A world without propaganda Pareto-dominates one where information can be manipulated. Although lowly destructive conflicts are conducive to war, arming can pacify the situation by giving rise to mixed strategy equilibria where peace is played with strictly positive probability. Countries are shown to have incentives to invest in propaganda despite the fact that war will then occur with strictly positive probability.
{"title":"Propaganda and conflict","authors":"Petros G. Sekeris","doi":"10.1016/j.geb.2025.08.006","DOIUrl":"10.1016/j.geb.2025.08.006","url":null,"abstract":"<div><div>In this article we explore how propaganda relates to conflict initiation. In the presence of propaganda, if conflict is highly destructive, parties invest in armaments to improve their share of the pie at the negotiation table. If conflict is lowly destructive, peace is never reached and arming is implemented to boost the troops' morale and fighting efficiency. For intermediate destruction levels, the game only admits mixed strategy equilibria where peace and conflict occur probabilistically. A world without propaganda Pareto-dominates one where information can be manipulated. Although lowly destructive conflicts are conducive to war, arming can pacify the situation by giving rise to mixed strategy equilibria where peace is played with strictly positive probability. Countries are shown to have incentives to invest in propaganda despite the fact that war will then occur with strictly positive probability.</div></div>","PeriodicalId":48291,"journal":{"name":"Games and Economic Behavior","volume":"153 ","pages":"Pages 569-585"},"PeriodicalIF":1.0,"publicationDate":"2025-10-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"144887014","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-10-01Epub Date: 2025-07-09DOI: 10.1016/j.geb.2025.06.009
David Lagziel, Yevgeny Tsodikovich
A decision maker (DM) uses an AI agent to estimate an unknown state, for which both possess informative private signals. Conditional on the state and the DM's final assessment, he prefers the AI's recommendations to be incorrect, thus affirming his own superiority or sharing the blame. Our analysis indicates that the correctness of the process is not a monotone function of participants' expertise levels: (i) a less accurate AI may lead to improved outcomes by reducing the DM's reliance on it, and (ii) a less accurate DM can enhance information aggregation leading to a superior result.
{"title":"Working with AI: An analysis for rational integration","authors":"David Lagziel, Yevgeny Tsodikovich","doi":"10.1016/j.geb.2025.06.009","DOIUrl":"10.1016/j.geb.2025.06.009","url":null,"abstract":"<div><div>A decision maker (DM) uses an AI agent to estimate an unknown state, for which both possess informative private signals. Conditional on the state and the DM's final assessment, he prefers the AI's recommendations to be incorrect, thus affirming his own superiority or sharing the blame. Our analysis indicates that the correctness of the process is not a monotone function of participants' expertise levels: (i) a less accurate AI may lead to improved outcomes by reducing the DM's reliance on it, and (ii) a less accurate DM can enhance information aggregation leading to a superior result.</div></div>","PeriodicalId":48291,"journal":{"name":"Games and Economic Behavior","volume":"153 ","pages":"Pages 254-267"},"PeriodicalIF":1.0,"publicationDate":"2025-10-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"144614614","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-10-01Epub Date: 2025-06-11DOI: 10.1016/j.geb.2025.05.012
Sabine Fischer , Kerstin Grosch
This study examines the effect of agents' overconfident expectations in their production on their contract breach. Drawing on a reference-dependent framework, we theoretically deduce propositions for compliance to agreements where an agent exhibits overconfidence and loss aversion. We further conduct a lab experiment with a multiple-stage design and find that overconfident agents are more likely to breach the contract than non-overconfident agents. Moreover, overconfident agents breach more often and to a greater extent with increasing loss aversion. We also test the impact of a non-deterministic environment (“shock condition”) where payoff misestimation can be masked compared to a deterministic environment (“no-shock condition”). Agents breach more often in the shock condition, but breach extent remains unaffected. Results are mostly in line with the theoretical framework. In a treatment, we manipulate agents' overconfidence exogenously and use it as an instrument to establish causality.
{"title":"Contract breach with overconfident expectations: Experimental evidence on reference-dependent preferences","authors":"Sabine Fischer , Kerstin Grosch","doi":"10.1016/j.geb.2025.05.012","DOIUrl":"10.1016/j.geb.2025.05.012","url":null,"abstract":"<div><div>This study examines the effect of agents' overconfident expectations in their production on their contract breach. Drawing on a reference-dependent framework, we theoretically deduce propositions for compliance to agreements where an agent exhibits overconfidence and loss aversion. We further conduct a lab experiment with a multiple-stage design and find that overconfident agents are more likely to breach the contract than non-overconfident agents. Moreover, overconfident agents breach more often and to a greater extent with increasing loss aversion. We also test the impact of a non-deterministic environment (“shock condition”) where payoff misestimation can be masked compared to a deterministic environment (“no-shock condition”). Agents breach more often in the shock condition, but breach extent remains unaffected. Results are mostly in line with the theoretical framework. In a treatment, we manipulate agents' overconfidence exogenously and use it as an instrument to establish causality.</div></div>","PeriodicalId":48291,"journal":{"name":"Games and Economic Behavior","volume":"153 ","pages":"Pages 145-163"},"PeriodicalIF":1.0,"publicationDate":"2025-10-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"144271798","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-10-01Epub Date: 2025-07-11DOI: 10.1016/j.geb.2025.07.001
Xiaotie Deng , Yotam Gafni , Ron Lavi , Tao Lin , Hongyi Ling
We study competition among multiple contest designers in a general model. The goal of each contest designer is to maximize the sum of efforts of the contestants participating in their contest. Assuming symmetric contestants, our main result shows that the optimal contests in the monopolistic setting (i.e., those that maximize the sum of efforts in a model with a single contest designer) form an equilibrium in the model with competition. Under a very natural assumption, these contests are dominant, and the equilibrium that they form is unique. Moreover, the equilibria with the optimal contests are Pareto-optimal even when other equilibria emerge. In many natural cases, they also maximize the social welfare. Additional examples show that, with further generalizations of our model, optimal contests no longer prevail. Our results therefore highlight and clarify the borderline between settings in which optimal contests prevail and do not prevail.
{"title":"From monopoly to competition: When do optimal contests prevail?","authors":"Xiaotie Deng , Yotam Gafni , Ron Lavi , Tao Lin , Hongyi Ling","doi":"10.1016/j.geb.2025.07.001","DOIUrl":"10.1016/j.geb.2025.07.001","url":null,"abstract":"<div><div>We study competition among multiple contest designers in a general model. The goal of each contest designer is to maximize the sum of efforts of the contestants participating in their contest. Assuming symmetric contestants, our main result shows that the optimal contests in the monopolistic setting (i.e., those that maximize the sum of efforts in a model with a single contest designer) form an equilibrium in the model with competition. Under a very natural assumption, these contests are dominant, and the equilibrium that they form is unique. Moreover, the equilibria with the optimal contests are Pareto-optimal even when other equilibria emerge. In many natural cases, they also maximize the social welfare. Additional examples show that, with further generalizations of our model, optimal contests no longer prevail. Our results therefore highlight and clarify the borderline between settings in which optimal contests prevail and do not prevail.</div></div>","PeriodicalId":48291,"journal":{"name":"Games and Economic Behavior","volume":"153 ","pages":"Pages 268-293"},"PeriodicalIF":1.0,"publicationDate":"2025-10-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"144656128","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-10-01Epub Date: 2025-07-06DOI: 10.1016/j.geb.2025.06.008
Shimon Kogan , Florian H. Schneider , Roberto A. Weber
Beliefs about collective outcomes play an important role in many contexts. We study biases in the formation of such beliefs. Specifically, we investigate whether self-serving biases in information processing—documented for beliefs about individual outcomes—affect beliefs about collective outcomes. In a first study, we find that people indeed exhibit self-serving biases for collective outcomes, and that such biases are similar to biases for individual outcomes. We also observe that the presence of a market institution for aggregating private information produces, if anything, slightly greater collective self-delusion. In a second study, we investigate the mechanisms driving collective self-delusion and find that anticipatory utility plays a large role, rather than ego-utility considerations.
{"title":"Self-serving biases in beliefs about collective outcomes","authors":"Shimon Kogan , Florian H. Schneider , Roberto A. Weber","doi":"10.1016/j.geb.2025.06.008","DOIUrl":"10.1016/j.geb.2025.06.008","url":null,"abstract":"<div><div>Beliefs about collective outcomes play an important role in many contexts. We study biases in the formation of such beliefs. Specifically, we investigate whether self-serving biases in information processing—documented for beliefs about individual outcomes—affect beliefs about collective outcomes. In a first study, we find that people indeed exhibit self-serving biases for collective outcomes, and that such biases are similar to biases for individual outcomes. We also observe that the presence of a market institution for aggregating private information produces, if anything, slightly greater collective self-delusion. In a second study, we investigate the mechanisms driving collective self-delusion and find that anticipatory utility plays a large role, rather than ego-utility considerations.</div></div>","PeriodicalId":48291,"journal":{"name":"Games and Economic Behavior","volume":"153 ","pages":"Pages 315-344"},"PeriodicalIF":1.0,"publicationDate":"2025-10-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"144686405","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-10-01Epub Date: 2025-08-19DOI: 10.1016/j.geb.2025.08.003
Konstantinos Protopappas , David Rietzke
We study the optimal design of an innovation contest where a buyer seeks product variety and faces a moral hazard problem. The suppliers are specialized and may differ in their flexibility to adopt approaches outside their areas of expertise. If the specializations are sufficiently different and suppliers are otherwise symmetric, the buyer attains the first-best with a fixed-prize contest (FPC). If one supplier is inherently advantaged or the specializations are sufficiently close, the first-best is unattainable with an FPC. In all cases, an auction is an optimal contest and implements the first-best, provided the buyer can discriminate within the contest; if not, the buyer may prefer an FPC.
{"title":"Incentivizing variety in innovation contests with specialized suppliers","authors":"Konstantinos Protopappas , David Rietzke","doi":"10.1016/j.geb.2025.08.003","DOIUrl":"10.1016/j.geb.2025.08.003","url":null,"abstract":"<div><div>We study the optimal design of an innovation contest where a buyer seeks product variety and faces a moral hazard problem. The suppliers are specialized and may differ in their flexibility to adopt approaches outside their areas of expertise. If the specializations are sufficiently different and suppliers are otherwise symmetric, the buyer attains the first-best with a fixed-prize contest (FPC). If one supplier is inherently advantaged or the specializations are sufficiently close, the first-best is unattainable with an FPC. In all cases, an auction is an optimal contest and implements the first-best, provided the buyer can discriminate within the contest; if not, the buyer may prefer an FPC.</div></div>","PeriodicalId":48291,"journal":{"name":"Games and Economic Behavior","volume":"153 ","pages":"Pages 586-621"},"PeriodicalIF":1.0,"publicationDate":"2025-10-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"144893464","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-10-01Epub Date: 2025-06-18DOI: 10.1016/j.geb.2025.06.004
Kriti Manocha , Bertan Turhan
This paper studies a multi-period college admissions problem where schools' choice rules incorporate affirmative action constraints. Students have the option to either finalize their assignments at the end of each period or participate in subsequent periods with the possibility of updating their rank-ordered lists (ROLs). We show that a gradual matching mechanism makes active students weakly better off (i.e. satisfies monotonicity) if and only if their ROL update rule meets a mild regularity condition. We introduce the notion of gradual stability adapted for multi-period matching mechanisms that account for affirmative action constraints. Furthermore, we show that the gradual stability of a gradual matching mechanism is equivalent to monotonicity in conjunction with the stability of the stage mechanism. Finally, we use our results to analyze the multi-stage mechanism currently used for engineering college admissions in India.
{"title":"Gradual matching with affirmative action","authors":"Kriti Manocha , Bertan Turhan","doi":"10.1016/j.geb.2025.06.004","DOIUrl":"10.1016/j.geb.2025.06.004","url":null,"abstract":"<div><div>This paper studies a multi-period college admissions problem where schools' choice rules incorporate affirmative action constraints. Students have the option to either finalize their assignments at the end of each period or participate in subsequent periods with the possibility of updating their rank-ordered lists (ROLs). We show that a gradual matching mechanism makes active students weakly better off (i.e. satisfies monotonicity) if and only if their ROL update rule meets a mild regularity condition. We introduce the notion of gradual stability adapted for multi-period matching mechanisms that account for affirmative action constraints. Furthermore, we show that the gradual stability of a gradual matching mechanism is equivalent to monotonicity in conjunction with the stability of the stage mechanism. Finally, we use our results to analyze the multi-stage mechanism currently used for engineering college admissions in India.</div></div>","PeriodicalId":48291,"journal":{"name":"Games and Economic Behavior","volume":"153 ","pages":"Pages 164-178"},"PeriodicalIF":1.0,"publicationDate":"2025-10-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"144338899","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-10-01Epub Date: 2025-06-06DOI: 10.1016/j.geb.2025.06.001
Shuhei Morimoto
We study a class of matching problems in which monetary transfers are possible. In this paper, we establish a close connection between the core and the existence of desirable rules that satisfy strategy-proofness or one-sided strategy-proofness. In our main result, we show that the optimal core is a unified lower bound of welfare for the existence of rules that satisfy strategy-proofness (or one-sided strategy-proofness), efficiency, individual rationality, and no subsidy. Applying this result, we also obtain impossibility and characterization results in our environment.
{"title":"Strategy-proofness, efficiency, and the core in matching problems with transfers","authors":"Shuhei Morimoto","doi":"10.1016/j.geb.2025.06.001","DOIUrl":"10.1016/j.geb.2025.06.001","url":null,"abstract":"<div><div>We study a class of matching problems in which monetary transfers are possible. In this paper, we establish a close connection between the core and the existence of desirable rules that satisfy strategy-proofness or one-sided strategy-proofness. In our main result, we show that the optimal core is a unified lower bound of welfare for the existence of rules that satisfy strategy-proofness (or one-sided strategy-proofness), efficiency, individual rationality, and no subsidy. Applying this result, we also obtain impossibility and characterization results in our environment.</div></div>","PeriodicalId":48291,"journal":{"name":"Games and Economic Behavior","volume":"153 ","pages":"Pages 30-41"},"PeriodicalIF":1.0,"publicationDate":"2025-10-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"144241155","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-10-01Epub Date: 2025-08-12DOI: 10.1016/j.geb.2025.08.002
Jonathan Newton, Miharu Naono
Maxmin decision making can take place at an individual or a coalitional level. We allow evolution to choose between the two, determining the relative shares of individual and coalitional decision making. We consider factors that favor or disfavor the evolution of coalitionality and apply our framework to social dilemmas, oligopolistic price competition and voting on committees.
{"title":"Maxmin, coalitions and evolution","authors":"Jonathan Newton, Miharu Naono","doi":"10.1016/j.geb.2025.08.002","DOIUrl":"10.1016/j.geb.2025.08.002","url":null,"abstract":"<div><div>Maxmin decision making can take place at an individual or a coalitional level. We allow evolution to choose between the two, determining the relative shares of individual and coalitional decision making. We consider factors that favor or disfavor the evolution of coalitionality and apply our framework to social dilemmas, oligopolistic price competition and voting on committees.</div></div>","PeriodicalId":48291,"journal":{"name":"Games and Economic Behavior","volume":"153 ","pages":"Pages 474-498"},"PeriodicalIF":1.0,"publicationDate":"2025-10-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"144841074","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":3,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}