An Experimental Investigation of Strategies in the Dynamic Common Pool Game

51 Pages Posted: 18 Nov 2011 Last revised: 22 Jun 2015

See all articles by Emanuel Vespa

Emanuel Vespa

UC Santa Barbara - Department of Economics

Date Written: November 28, 2011

Abstract

This paper studies experimentally the selection of strategies in a canonical dynamic environment, the dynamic common pool game. The main goal is to evaluate if behavior can be rationalized with strategies that condition on past play that can support efficient outcomes, or with stationary Markov strategies that only condition on the “state of the system.” The main finding is that modal behavior is Markovian even when the gains from cooperation are large. However, the popularity of Markov strategies is decreasing in the incentives to cooperate. The evidence also suggests that early coordination failures when trying to implement the efficient outcome can contribute to coordination on Markov play.

Keywords: dynamic games, experiments, cooperation, tragedy of the commons

JEL Classification: C73, C92

Suggested Citation

Vespa, Emanuel, An Experimental Investigation of Strategies in the Dynamic Common Pool Game (November 28, 2011). Available at SSRN: https://ssrn.com/abstract=1961450 or http://dx.doi.org/10.2139/ssrn.1961450

Emanuel Vespa (Contact Author)

UC Santa Barbara - Department of Economics ( email )

2127 North Hall University of California
Santa Barbara, CA 93117
United States

HOME PAGE: http://https://sites.google.com/site/emanuelvespa/

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