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Intelligence Disclosure and Cooperation in Repeated Interactions

Author

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  • Marco Lambrecht
  • Eugenio Proto
  • Aldo Rustichini
  • Andis Sofianos

Abstract

How does information about players' intelligence affect strategic behavior? Game theory, based on the assumption of common knowledge of rationality, does not provide useful predictions. We experimentally show that, in the Prisoner's Dilemma, disclosure hampers cooperation: higher-intelligence players trust their partners less when playing against someone of lower ability. Similarly, in the Battle of Sexes with low payoff inequality, disclosure disrupts coordination, as higher-intelligence players try to force their most preferred outcome. Instead, with higher payoff inequality, behavior changes and higher-intelligence players concede. We analyze the reasons for these patterns of behavior.

Suggested Citation

  • Marco Lambrecht & Eugenio Proto & Aldo Rustichini & Andis Sofianos, 2024. "Intelligence Disclosure and Cooperation in Repeated Interactions," American Economic Journal: Microeconomics, American Economic Association, vol. 16(3), pages 199-231, August.
    • Handle: RePEc:aea:aejmic:v:16:y:2024:i:3:p:199-231
    DOI: 10.1257/mic.20220245
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    3. Piotr Evdokimov & Umberto Garfagnini, 2023. "Cognitive Ability and Perceived Disagreement in Learning," Rationality and Competition Discussion Paper Series 381, CRC TRR 190 Rationality and Competition.

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    More about this item

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • 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
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making

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