General Economic Principles of Bargaining and Trade: Evidence from 2,000 Classroom Experiments

45 Pages Posted:  

Po-Hsuan Lin

MobLab; National Taiwan University

Alexander L. Brown

Texas A&M University - Department of Economics

Taisuke Imai

Ludwig Maximilian University of Munich

Joseph Tao-yi Wang

National Taiwan University - Department of Economics

Stephanie Wang

University of Pittsburgh

Colin Camerer

California Institute of Technology - Division of the Humanities and Social Sciences

Date Written: September 16, 2018

Abstract

Standardized classroom economics experiments provide a treasure trove of evidence about how well results reproduce when nearly-identical methods are used. We use a sample of around 20,000 observations to test reproducibility in bargaining and trading. Ultimatum bargaining exhibits some geographical variation, and shows that equal split offers are accepted more often and more quickly than slightly unequal offers. Double auction results are highly reproducible and are close to equilibrium predictions. Our large sample shows robust, strong correlations between how individual surplus and trading order, and autocorrelation ( 0.5) of successive price changes, consistent with trading dynamics based on limited rationality.

Keywords: Generalizability, ultimatum game, double auction, price formation, heterogeneity

JEL Classification: C88, D44, C78

Suggested Citation

Lin, Po-Hsuan and Brown, Alexander L. and Imai, Taisuke and Wang, Joseph Tao-yi and Wang, Stephanie and Camerer, Colin F., General Economic Principles of Bargaining and Trade: Evidence from 2,000 Classroom Experiments (September 16, 2018). Available at SSRN: https://ssrn.com/abstract=

Po-Hsuan Lin

MobLab ( email )

National Taiwan University ( email )

1 Sec. 4, Roosevelt Road
Taipei 106, 106
Taiwan

Alexander L. Brown

Texas A&M University - Department of Economics ( email )

4228 TAMU
College Station, TX 77843-4228
United States
979-862-8084 (Phone)
979-847-8757 (Fax)

HOME PAGE: http://econweb.tamu.edu/abrown/

Taisuke Imai

Ludwig Maximilian University of Munich ( email )

Geschwister-Scholl-Platz 1
Munich, Bavaria 80539
Germany

Joseph Tao-yi Wang

National Taiwan University - Department of Economics ( email )

1 Roosevelt Road, Section 4
Department of Economics
Taipei, 106
Taiwan
886-2-33668411 (Phone)

HOME PAGE: http://homepage.ntu.edu.tw/~josephw/

Stephanie Wang

University of Pittsburgh ( email )

135 N Bellefield Ave
Pittsburgh, PA 15260
United States

Colin F. Camerer (Contact Author)

California Institute of Technology - Division of the Humanities and Social Sciences ( email )

1200 East California Blvd.
Pasadena, CA 91125
United States
626-395-4054 (Phone)
626-432-1726 (Fax)

Register to save articles to
your library

Register

Paper statistics

Downloads
29
Abstract Views
221
PlumX