Effects of experience, choice architecture, and cognitive reflection in strategyproof mechanisms

Mark Schneider and David Porter

Journal of Economic Behavior & Organization, 2020, vol. 171, issue C, 361-377

Abstract: We study how performance in strategyproof mechanisms is affected by experience with the decision environment, choice architecture (selection among strategically equivalent mechanisms), and cognitive reflection. In both individual and strategic decisions, we observe substantial gaps in performance between high reflective and low reflective participants. We also find that choice architecture and experience narrow these gaps in performance. Our primary finding is that experience serves as a substitute for cognitive reflection: Across a series of experiments employing multiple rounds of a lottery task, a second price sealed bid auction, an English clock auction, and a random serial dictatorship allocation mechanism, we consistently find that the performance of low reflection participants with experience is similar to that of high reflection participants without experience. For the mechanisms we study, we also find that switching from a strategyproof to an ‘obviously strategyproof’ mechanism generally has a larger effect on performance than experience.

Keywords: Cognitive reflection; Auctions; Market design (search for similar items in EconPapers)
Date: 2020
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Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jeborg:v:171:y:2020:i:c:p:361-377

DOI: 10.1016/j.jebo.2020.01.012

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