Template-Type: ReDIF-Paper 1.0 Series: Tinbergen Institute Discussion Papers Creation-Date: 2015-01-15 Number: 15-012/VII Author-Name: Adrian de Groot Ruiz Author-Workplace-Name: Radboud University Nijmegen, the Netherlands Author-Name: Theo Offerman Author-Workplace-Name: Amsterdam School of Economics, University of Amsterdam, the Netherlands Author-Name: Sander Onderstal Author-Workplace-Name: Amsterdam School of Economics, University of Amsterdam, the Netherlands Title: Equilibrium Selection in Experimental Cheap Talk Games Abstract: Published in 'Games and Economic Behavior'.
In the past, many refinements have been proposed to select equilibria in cheap talk games. Usually, these refinements were motivated by a discussion of how rational agents would reason in some particular cheap talk games. In this paper, we propose a new refinement and stability measure that is intended to predict actual behavior in a wide range of cheap talk games. According to our Average Credible Deviation Criterion (ACDC), the stability of an equilibrium is determined by the frequency and size of credible deviations. ACDC organizes the results from several cheap talk experiments in which behavior converged to equilibrium, even in cases where other criteria do not make a prediction. Classification-JEL: C72, C92, D82, D83 Keywords: Cheap talk, Neologism proofness, Credible deviation, Refinement, ACDC, Experiment File-Url: http://papers.tinbergen.nl/15012.pdf File-Format: application/pdf File-Size: 411322 bytes Handle: RePEc:tin:wpaper:20150012