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Lim, Wooyoung, Matros, Alexander and Turocy, Theodore 
ORCID: https://orcid.org/0000-0002-2265-844X
(2014)
Bounded rationality and group size in Tullock contests: Experimental evidence.
Journal of Economic Behavior & Organization, 99.
pp. 155-167.
Abstract
We explore how models of boundedly-rational decision-making in games can explain the overdissipation of rents in laboratory Tullock contest games. Using a new series of experiments in which group size is varied across sessions, we find that models based on logit choice organize the data well. In this setting, logit quantal response equilibrium (QRE) is a limit of a cognitive hierarchy (CH) model with logit best responses for appropriate parameters. While QRE captures the data well, the CH fits provide support for relaxing the equilibrium assumption. Both the QRE and CH models have parameters which capture boundedness of rationality. The maximum likelihood fits of both models yield parameters indicating rationality is more restricted as group size grows. Period- by-period adjustments of expenditures are more likely to be in the earnings-improving direction in smaller groups.
| Item Type: | Article |
|---|---|
| Faculty \ School: | Faculty of Social Sciences > School of Economics |
| UEA Research Groups: | Faculty of Social Sciences > Research Groups > Environment, Resources and Conflict Faculty of Social Sciences > Research Groups > Economic Theory Faculty of Social Sciences > Research Centres > Centre for Behavioural and Experimental Social Sciences Faculty of Social Sciences > Research Groups > Experimental Economics (former - to 2017) Faculty of Social Sciences > Research Centres > Centre for Competition Policy Faculty of Social Sciences > Research Groups > Behavioural Economics |
| Depositing User: | Pure Connector |
| Date Deposited: | 06 Jan 2014 13:58 |
| Last Modified: | 13 Jun 2023 08:09 |
| URI: | https://ueaeprints.uea.ac.uk/id/eprint/46960 |
| DOI: | 10.1016/j.jebo.2013.12.010 |
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