Teaching Nash Equilibrium and Dominance: A Classroom Experiment on the Beauty Contest

Virtudes Alba-Fernández, Pablo Brañas-Garza, Francisca Jiménez-Jiménez and Javier Rodero-Cosano ()

IESA Working Papers Series from Institute for Social Syudies of Andalusia - Higher Council for Scientific Research

Abstract: The aim of this investigation is to show how the use of classroom experiments may be a good pedagogical tool to teach the Nash equilibrium (NE) concept. For our purposes, the basic game is a repeated version of the Beauty Contest Game (BCG), a simple guessing game in which repetition lets students react to other players’ choices and converge iteratively to the equilibrium solution. We perform this experiment with undergraduate students with no previous training in game theory. After four rounds, we observe a clear decreasing tendency in the average submitted number in all groups. Thus, our findings prove that by playing a repeated BCG, students quickly learn how to reach the NE solution.

Keywords: Classroom Experiments; Beauty Contest Game; Teaching; Nash Equilibrium (search for similar items in EconPapers)
Pages: 40 pages
Date: 2004
New Economics Papers: this item is included in nep-hpe
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Related works:
Journal Article: Teaching Nash Equilibrium and Dominance: A Classroom Experiment on the Beauty Contest (2006)
Working Paper: Teaching Nash Equilibrium and Strategy Dominance: A Classroom Experiment on the Beauty Contest (2003)
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Persistent link: https://EconPapers.repec.org/RePEc:esa:iesawp:0413

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