Imitation and the evolution of walrasian behavior : theoretically fragile but behaviorally robust


Apesteguia, Jose ; Huck, Steffen ; Oechssler, Jörg ; Weidenholzer, Simon


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URL: https://ub-madoc.bib.uni-mannheim.de/2470
URN: urn:nbn:de:bsz:180-madoc-24705
Document Type: Working paper
Year of publication: 2007
The title of a journal, publication series: Rationalitätskonzepte, Entscheidungsverhalten und ökonomische Modellierung
Volume: 07-69
Place of publication: Mannheim
Publication language: English
Institution: School of Law and Economics > Sonstige - Fakultät für Rechtswissenschaft und Volkswirtschaftslehre
MADOC publication series: Sonderforschungsbereich 504 > Rationalitätskonzepte, Entscheidungsverhalten und ökonomische Modellierung (Laufzeit 1997 - 2008)
Subject: 330 Economics
Classification: JEL: L13 D43 C92 C91 C72 ,
Subject headings (SWD): Imitationswettbewerb , Evolutionäre Spieltheorie , Oligopol , Allgemeines Gleichgewicht , Test , Theorie
Keywords (English): Evolutionary game theory , Stochastic stability , Imitation , Cournot markets , Information , Experiments , Simulations
Abstract: A well-known result by Vega-Redondo implies that in symmetric Cournot oligopoly, imitation leads to the Walrasian outcome where price equals marginal cost. In this paper we show that this result is not robust to the slightest asymmetry in fixed costs. Instead of obtaining the Walrasian outcome as unique prediction, every outcome where agents choose identical actions will be played some fraction of the time in the long run. We then conduct experiments to check this fragility. We obtain that, contrary to the theoretical prediction, the Walrasian outcome is still a good predictor of behavior.
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Apesteguia, Jose ; Huck, Steffen ; Oechssler, Jörg ; Weidenholzer, Simon (2007) Imitation and the evolution of walrasian behavior : theoretically fragile but behaviorally robust. Open Access Rationalitätskonzepte, Entscheidungsverhalten und ökonomische Modellierung Mannheim 07-69 [Working paper]
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