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Probability Matching and Reinforcement Learning

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  • Javier Rivas

Abstract

Probability matching occurs when an action is chosen with a frequency equivalent to the probability of that action being the best choice. This sub-optimal behavior has been reported repeatedly by psychologist and experimental economist. We provide an evolutionary foundation for this phenomenon by showing that learning by reinforcement can lead to probability matching and, if learning occurs suffciently slowly, probability matching does not only occur in choice frequencies but also in choice probabilities. Our results are completed by proving that there exists no quasi-linear reinforcement learning specification such that behavior is optimal for all environments where counterfactuals are observed.

Suggested Citation

  • Javier Rivas, 2011. "Probability Matching and Reinforcement Learning," Discussion Papers in Economics 11/20, Division of Economics, School of Business, University of Leicester.
    • Handle: RePEc:lec:leecon:11/20
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    File URL: https://www.le.ac.uk/economics/research/RePEc/lec/leecon/dp11-20.pdf
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    References listed on IDEAS

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    5. Javier Rivas, 2008. "Learning within a Markovian Environment," Economics Working Papers ECO2008/13, European University Institute.
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    More about this item

    Keywords

    Probability Matching; Reinforcement Learning;

    JEL classification:

    • C73 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Stochastic and Dynamic Games; Evolutionary Games

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