Strategic sophistication of individuals and teams. Experimental evidence
Matthias Sutter,
Simon Czermak and
Francesco Feri
European Economic Review, 2013, vol. 64, issue C, 395-410
Abstract:
Many important decisions require strategic sophistication. We examine experimentally whether teams act more strategically than individuals. We let individuals and teams make choices in simple games, and also elicit first- and second-order beliefs. We find that teams play the Nash equilibrium strategy significantly more often, and their choices are more often a best response to stated first order beliefs. Distributional preferences make equilibrium play less likely. Using a mixture model, the estimated probability to play strategically is 62% for teams, but only 40% for individuals. A model of noisy introspection reveals that teams differ from individuals in higher order beliefs.
Keywords: Strategic sophistication; Experiment; Team decision making; Individual decision making; Noisy introspection (search for similar items in EconPapers)
JEL-codes: C72 C91 C92 (search for similar items in EconPapers)
Date: 2013
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Citations: View citations in EconPapers (25)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:eecrev:v:64:y:2013:i:c:p:395-410
DOI: 10.1016/j.euroecorev.2013.06.003
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