The Alpha-beauty contest: Choosing numbers, thinking intervals
Journal
Games and Economic Behavior
ISSN
0899-8256
ISSN-Digital
1090-2473
Type
journal article
Date Issued
2008-11
Author(s)
Abstract
We present a model for the ?-beauty contest that explains common patterns in experimental data of one-shot and iterative games. The approach is based on two basic assumptions. First, players iteratively update their recent guesses. Second, players estimate intervals rather than exact numbers to cope with incomplete knowledge of other players' rationality. Under these assumptions we extend the cognitive hierarchy model of Camerer et al. [Camerer, C., Ho, T., Chong, J., 2003b. A cognitive hierarchy model of one-shot games. Quart. J. Econ. 119, 861-898]. The extended model is estimated on experimental data from a newspaper experiment.
Language
English
Keywords
Experiments
alpha-beauty contest
beliefs.
HSG Classification
contribution to scientific community
Refereed
Yes
Publisher
Elsevier
Publisher place
Amsterdam
Volume
64
Number
2
Start page
470
End page
486
Pages
17
Subject(s)
Eprints ID
51178