behavioural game theory
From The New Palgrave Dictionary of Economics, Second Edition, 2008
Edited by
Steven
N.
Durlauf
and
Lawrence
E.
Blume
Back to top
Abstract
Behavioural game theory uses experimental regularities and psychology to model formally how limits on strategic thinking, learning, and social preferences interact when people actually play games. Emerging theories of behaviour in ultimatum and trust games (and others) focus on an aversion to inequality, reciprocity, or concern for social image. Learning models often focus on numerical updating of an unobserved propensity to choose a strategy (including fictitious play updating of beliefs as a special case). Models of limits on strategic thinking assume players are in equilibrium, but respond with error, or there is a cognitive hierarchy of increasingly sophisticated reasoning.
Back to top
Back to top
Keywords
adaptive expectations; altruism; analytical game theory; auctions; behavioural game theory; bounded rationality; cognitive hierarchy theories; communication; competition; contracting; coordination; dictator games; direction learning; disequilibrium behaviour; entry deterrence games; experience weighted attraction; individual learning in games; inequality aversion; learning; mixed strategy equilibrium; moral hazard; negative reciprocity; quantal response equilibrium; rational expectations; Rawls, J.; reciprocity; replicator dynamics; self-interest; signalling; social preferences; tit for tat; trust games; ultimatum games; utilitarianism; weighted fictitious playHow to cite this article
Camerer, Colin F. "behavioural game theory." The New Palgrave Dictionary of Economics. Second Edition. Eds. Steven N. Durlauf and Lawrence E. Blume. Palgrave Macmillan, 2008. The New Palgrave Dictionary of Economics Online. Palgrave Macmillan. 23 November 2011 <http://www.dictionaryofeconomics.com/article?id=pde2008_B000302> doi:10.1057/9780230226203.0117
Share This