M Equilibrium: A theory of beliefs and choices in games

Jacob Goeree and Philippos Louis

Papers from arXiv.org

Abstract: We introduce a set-valued solution concept, M equilibrium, to capture empirical regularities from over half a century of game-theory experiments. We show M equilibrium serves as a meta theory for various models that hitherto were considered unrelated. M equilibrium is empirically robust and, despite being set-valued, falsifiable. We report results from a series of experiments comparing M equilibrium to leading behavioral-game-theory models and demonstrate its virtues in predicting observed choices and stated beliefs. Data from experimental games with a unique pure-strategy Nash equilibrium and multiple M equilibria exhibit coordination problems that could not be anticipated through the lens of existing models.

Date: 2018-11, Revised 2021-04
New Economics Papers: this item is included in nep-exp, nep-gth, nep-mic and nep-upt
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Citations: View citations in EconPapers (4)

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Journal Article: M Equilibrium: A Theory of Beliefs and Choices in Games (2021)
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Persistent link: https://EconPapers.repec.org/RePEc:arx:papers:1811.05138

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