25 Pages Posted: 14 Dec 2016
Date Written: November 08, 2016
We study a class of deceptively similar games, which however have different player sets and predictions that vary with their cardinality. The economic, biological, political, and psychological applications are many. The game-theoretic principles involved are compelling as predictions rely on weaker and less controversial epistemic foundations than needed to justify backward inductions more generally. Is the account empirically relevant? We design and report results from a relevant experiment.
Keywords: backward induction, interactive epistemology, player set cardinality, experiment
JEL Classification: C720, C920
Suggested Citation: Suggested Citation
Dufwenberg, Martin and Van Essen, Matt, King of the Hill: Giving Backward Induction Its Best Shot (November 08, 2016). CESifo Working Paper Series No. 6169. Available at SSRN: https://ssrn.com/abstract=2885243