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Level-k reasoning and time pressure in the 11-20 money request game

Florian Lindner (florian.r.lindner@hotmail.com) and Matthias Sutter (matthias.sutter@coll.mpg.de)

Working Papers from Faculty of Economics and Statistics, Universität Innsbruck

Abstract: Arad and Rubinstein (2012a) have designed a novel game to study level-k reasoning experimentally. Just like them, we find that the depth of reasoning is very limited and clearly different from equilibrium play. We show that such behavior is even robust to repetitions, hence there is, at best, little learning. However, under time pressure, behavior is, perhaps coincidentally, closer to equilibrium play. We argue that time pressure evokes intuitive reasoning and reduces the focal attraction of choosing higher (and per se more profitable) numbers in the game.

Keywords: Level-k reasoning; Time pressure; Repetition; Experiment (search for similar items in EconPapers)
JEL-codes: C72 C91 (search for similar items in EconPapers)
Pages: 17
Date: 2013-06
New Economics Papers: this item is included in nep-cbe, nep-evo, nep-exp, nep-gth and nep-hpe
References: Add references at CitEc
Citations: View citations in EconPapers (26)

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Related works:
Journal Article: Level-k reasoning and time pressure in the 11–20 money request game (2013) Downloads
Working Paper: Level-k reasoning and time pressure in the 11-20 money request game (2013)
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