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Irreversibility and Monitoring in Dynamic Games: Experimental Evidence

Author

Listed:
  • Andrew Choi
  • Syngjoo Choi
  • Yves Gueron
  • Eungik Lee

Abstract

This paper provides experimental evidence on the impacts of irreversibility and imperfect monitoring on the efficiency and the equity of repeated public goods game. We find that irreversibility and imperfect monitoring both lead to inefficient and unequal outcomes through different channels. Irreversibility lowers public goods contribution in earlier periods and makes the initial-period contribution gap between two players long-lasting. Imperfect monitoring hampers conditional cooperation and reduces group contribution persistently. A finite mixture estimation with conditional cooperator provides a coherent account of the treatment effects.

Suggested Citation

  • Andrew Choi & Syngjoo Choi & Yves Gueron & Eungik Lee, 2020. "Irreversibility and Monitoring in Dynamic Games: Experimental Evidence," Working Paper Series no133, Institute of Economic Research, Seoul National University.
  • Handle: RePEc:snu:ioerwp:no133
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    More about this item

    Keywords

    repeated games; dynamic games; imperfect monitoring; irreversibility; cooperation;
    All these keywords.

    JEL classification:

    • C73 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Stochastic and Dynamic Games; Evolutionary Games
    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior

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