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Bandits in the lab

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  • Johannes Hoelzemann
  • Nicolas Klein

Abstract

We experimentally implement a dynamic public‐good problem, where the public good in question is the dynamically evolving information about agents' common state of the world. Subjects' behavior is consistent with free‐riding because of strategic concerns. We also find that subjects adopt more complex behaviors than predicted by the welfare‐optimal equilibrium, such as noncut‐off behavior, lonely pioneers, and frequent switches of action.

Suggested Citation

  • Johannes Hoelzemann & Nicolas Klein, 2021. "Bandits in the lab," Quantitative Economics, Econometric Society, vol. 12(3), pages 1021-1051, July.
    • Handle: RePEc:wly:quante:v:12:y:2021:i:3:p:1021-1051
    DOI: 10.3982/QE1389
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    Cited by:

    1. Kaustav Das & Nicolas Klein & Katharina Schmid, 2020. "Strategic experimentation with asymmetric players," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 69(4), pages 1147-1175, June.
    2. Jean Paul Rabanal & Aleksei Chernulich & John Horowitz & Olga A. Rud & Manizha Sharifova, 2019. "Market timing under public and private information," Working Papers 151, Peruvian Economic Association.
    3. Lepage, Louis Pierre, 2021. "Endogenous learning, persistent employer biases, and discrimination," CLEF Working Paper Series 34, Canadian Labour Economics Forum (CLEF), University of Waterloo.
    4. Hudja, Stanton, 2021. "Is Experimentation Invariant to Group Size? A Laboratory Analysis of Innovation Contests," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 91(C).
    5. Chernulich, Aleksei & Horowitz, John & Rabanal, Jean Paul & Rud, Olga A & Sharifova , Manizha, 2021. "Entry and exit decisions under public and private information: An experiment," UiS Working Papers in Economics and Finance 2021/3, University of Stavanger.
    6. Lepage, Louis Pierre, 2020. "Endogenous learning and the persistence of employer biases in the labor market," CLEF Working Paper Series 24, Canadian Labour Economics Forum (CLEF), University of Waterloo.

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    More about this item

    JEL classification:

    • C73 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Stochastic and Dynamic Games; Evolutionary Games
    • C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
    • O32 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Management of Technological Innovation and R&D

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