Does Informational Equivalence Preserve Strategic Behavior? An Experimental Study on Trockel's Game
Papatya Duman ()
Additional contact information
Papatya Duman: Paderborn University
No 117, Working Papers CIE from Paderborn University, CIE Center for International Economics
The purpose of the present study is to experimentally test a version of the classical Chain Store Game (CSG) paradox, proposed by Trockel (1986), and determine whether one of the two theories of Induction and Deterrence, which were originally tested competitively by Selten (1978), may better account for the results. With complete and perfect information, the CSG of Selten (1978) was designed to analyze the role of reputation in repeated market interactions. Its results were discussed in two diﬀerent ways: one is based on backward induction, and the other is intuitively derived from a deterrence argument. As the two explanations are incompatible, alternative models have been proposed to understand them better. The alternative game proposed by Trockel is an imperfect information version of the CSG in which the order of the two players is changed in each round and the ’Out-Aggressive’ equilibrium is used to build reputation. The existence of more than one equilibrium is the basis for the building of reputation. To the best of my knowledge, this study is the ﬁrst attempt to experimentally test this alternative game with the same purpose.
Keywords: Chain Store Game; reputation building; entry deterrence; Trockel's game (search for similar items in EconPapers)
JEL-codes: C7 C9 (search for similar items in EconPapers)
Pages: 28 pages
New Economics Papers: this item is included in nep-exp and nep-gth
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed
Downloads: (external link)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:pdn:ciepap:117
Access Statistics for this paper
More papers in Working Papers CIE from Paderborn University, CIE Center for International Economics Contact information at EDIRC.
Bibliographic data for series maintained by WP-WiWi-Info () and ().