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Knowing me, knowing you: an experiment on mutual payoff information in the stag hunt and Prisoner’s Dilemma

Author

Listed:
  • Hazem Alshaikhmubarak

    (King Faisal University)

  • David Hales

    (Global Innovations Bank)

  • Maria Kogelnik

    (Yale University)

  • Molly Schwarz

    (Federal Communications Commission)

  • C. Kent Strauss

    (University of California Santa Barbara)

Abstract

We experimentally study how mutual payoff information affects strategic play. Subjects play the Prisoner’s Dilemma or Stag Hunt game against randomly re-matched opponents under two information treatments. In our partial-information treatment, subjects are shown only their own payoff structure, while in our full-information treatment they are shown both their own and their opponent’s payoff structure. In both treatments, they receive feedback on their opponent’s action after each round. We find that mutual payoff information initially facilitates reaching the socially optimal outcome in both games. Play in the Prisoner’s Dilemma converges toward the unique Nash equilibrium of the game under both information treatments, while in the Stag Hunt mutual payoff information has a substantial impact on play and equilibrium selection in all rounds of the game. Belief-learning model estimations and simulations suggest these effects are driven by both initial play and the way subjects learn.

Suggested Citation

  • Hazem Alshaikhmubarak & David Hales & Maria Kogelnik & Molly Schwarz & C. Kent Strauss, 2024. "Knowing me, knowing you: an experiment on mutual payoff information in the stag hunt and Prisoner’s Dilemma," Journal of the Economic Science Association, Springer;Economic Science Association, vol. 10(2), pages 428-441, December.
    • Handle: RePEc:spr:jesaex:v:10:y:2024:i:2:d:10.1007_s40881-024-00167-5
    DOI: 10.1007/s40881-024-00167-5
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    More about this item

    Keywords

    Payoff information; Stag hunt; Prisoner’s dilemma; Economics experiments;
    All these keywords.

    JEL classification:

    • C71 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Cooperative Games
    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness

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