On the Empirical Content of Quantal Response Equilibrium

Philip Haile, Ali Hortacsu and Grigory Kosenok

American Economic Review, 2008, vol. 98, issue 1, 180-200

Abstract: The quantal response equilibrium (QRE) notion of Richard D. McKelvey and Thomas R. Palfrey (1995) has recently attracted considerable attention, due in part to its widely documented ability to rationalize observed behavior in games played by experimental subjects. However, even with strong a priori restrictions on unobservables, QRE imposes no falsifiable restrictions: it can rationalize any distribution of behavior in any normal form game. After demonstrating this, we discuss several approaches to testing QRE under additional maintained assumptions. (JEL C72, D84)

JEL-codes: C72 D84 (search for similar items in EconPapers)
Date: 2008
Note: DOI: 10.1257/aer.98.1.180
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Citations: View citations in EconPapers (93)

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Related works:
Working Paper: On the Empirical Content of Quantal Response Equilibrium (2006)
Working Paper: On the Empirical Content of Quantal Response Equilibrium (2006)
Working Paper: On the Empirical Content of Quantal Response Equilibrium (2004)
Working Paper: On the Empirical Content of Quantal Response Equilibrium (2003)
Working Paper: On the Empirical Content of Quantal Response Equilibrium (2003)
Working Paper: On the Empirical Content of Quantal Response Equilibrium (0820)
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