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Experimental investigation of stationary concepts in cyclic duopoly games

Published online by Cambridge University Press:  14 March 2025

Sebastian J. Goerg  and
Reinhard Selten
Sebastian J. Goerg*
Affiliation:
Max Planck Institute for Research on Collective Goods, Kurt-Schumacher-Str. 10, 53113 Bonn, Germany BonnEconLab, Laboratory for Experimental Economics, Department of Economics, University of Bonn, Adenaueralle 24-42, 53113 Bonn, Germany
Reinhard Selten
Affiliation:
BonnEconLab, Laboratory for Experimental Economics, Department of Economics, University of Bonn, Adenaueralle 24-42, 53113 Bonn, Germany
*
e-mail: [email protected]
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Abstract

We experimentally test the predictive success of three stationary concepts in two cyclic duopoly games. The concepts are Nash equilibrium, impulse-balance equilibrium and payoff-sampling equilibrium. In the experiment 11 independent subject groups, consisting out of six participants interacting over 200 rounds, were gathered for each game. The comparison of the three concepts with mixed strategies shows that the order of performance from best to worst is as follows: payoff-sampling equilibrium, impulse-balance equilibrium, and Nash equilibrium. In addition the data exhibit a weak but significant tendency over time in the direction of coordination at a pure strategy equilibrium.

Keywords

Cyclic game duopoly experimentImpulse-balance equilibriumPayoff-sampling equilibrium

JEL classification

D43: Oligopoly and Other Forms of Market Imperfection C90: General C73: Stochastic and Dynamic Games • Evolutionary Games • Repeated Games
Type
Research Article
Information
Experimental Economics , Volume 12 , Issue 3 , September 2009 , pp. 253 - 271
Copyright
Copyright © The Author(s) 2009

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Footnotes

Electronic supplementary material The online version of this article (http://dx.doi.org/10.1007/s10683-009-9218-8) contains supplementary material, which is available to authorized users.

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