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Counter Intuitive Learning: An Exploratory Study

42 Pages Posted: 26 Sep 2016  

Nobuyuki Hanaki

Université Côte d'Azur, CNRS, GREDEG

Alan P. Kirman

Aix Marseile University and Ecole des Hautes Etudes en Sciences Sociales; CAMS EHESS

Paul Pezanis‐Christou

University of Adelaide

Date Written: August 08, 2016

Abstract

The literature on learning in unknown environments emphasises reinforcing on actions which produce positive results. But, in some cases, success requires shifting from a currently successful actions to others. We examine, experimentally and theoretically in a very simple framework, how individuals initially learn by exploiting information from the pay-offs of actions taken but also from exploring new actions. We analyse if and how they learn that pay-offs are inter-temporally dependent. We then ran the same experiments but where individuals could observe the actions taken or the pay-offs obtained by others or both. Such observations improved pay-offs if one of the pair had learned to obtain the maximum pay-off.

Keywords: multi-armed bandit, reinforcement learning, eureka moment, pay-off patterns, observational learning

JEL Classification: D810, D830

Suggested Citation

Hanaki, Nobuyuki and Kirman, Alan P. and Pezanis‐Christou, Paul, Counter Intuitive Learning: An Exploratory Study (August 08, 2016). CESifo Working Paper Series No. 6029. Available at SSRN: https://ssrn.com/abstract=2843476

Nobuyuki Hanaki

Université Côte d'Azur, CNRS, GREDEG

250 Rue Albert Einstein
Valbonne, 06560
France

Alan P. Kirman (Contact Author)

Aix Marseile University and Ecole des Hautes Etudes en Sciences Sociales ( email )

3 Avenue Robert Schuman,
France

CAMS EHESS ( email )

190-198, avenue de France,
Paris, 75244
France
+33612241766 (Phone)

Paul Pezanis‐Christou

University of Adelaide

No 233 North Terrace, School of Commerce
Adelaide, South Australia 5005
Australia

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