Subjective probabilities in games: An application to the overbidding puzzle

International Economic Review

Volumn 50, Issue 4, 2009, Pages 1079-1102

  Armantier, Olivier ^a,b,c,d   Treich, Nicolas ^a,b,c,d  

^a FEDERAL RESERVE BANK OF NEW YORK   (United States)

^b UNIVERSITÉ DE MONTRÉAL   (Canada)

^c Canada H3A 2T7   (Canada)

^d TOULOUSE SCHOOL OF ECONOMICS   (France)

Author keywords

[No Author keywords available]

Indexed keywords

EID: 70350508534     PISSN: 00206598     EISSN: 14682354     Source Type: Journal    
DOI: 10.1111/j.1468-2354.2009.00560.x     Document Type: Article

References (63)

1. Ali, M. Probability and Utility Estimates for Racetrack Bettors Journal of Political Economy 85 (1977 803 815.
2. Anderson, S., J. Goeree, and C. Holt The Logit Equilibrium: A Perspective on Intuitive Behavioral Anomalies Southern Economic Journal 69 (2002 21 47.
3. Armantier, O., and N. Treich Probability Misperception in Games: An Application to the Overbidding Puzzle Mimeo, Université de Montréal, 2006.
4. Armantier, O., and N. Treich Star-Shaped Probability Weighting Functions and Overbidding in First-Price Auctions Economics Letters 104 (2009 83 5.
5. Bellemare, C., S. Kröger, and A. van Soest Measuring Inequity Aversion in a Heterogeneous Population Using Experimental Decisions and Subjective Probabilities Econometrica 76 (2008 815 839.
6. Benjamin, D., W. Dougan, and D. Buschena Individuals' Estimates of the Risks of Death: Part II-New Evidence Journal of Risk and Uncertainty 22 (2001 35 57. (Pubitemid 33635130)
7. Camerer, C. Individual Decision Making in J. H. Kagel, and A.E. Roth, eds., Handbook of Experimental Economics (Princeton, NJ : Princeton University Press, 1995 587 703.
8. Camerer, C., and D. Lovallo Overconfidence and Excess Entry: An Experimental Approach American Economic Review 89 (1999 306 318.
9. Camerer, C., T. Ho, and J. Chong Behavioral Game Theory: Thinking, Learning, and Teaching in S. Huck, ed., Advances in Understanding Strategic Behaviour: Game Theory, Experiments, and Bounded Reality: Essays in Honour of Werner Guth (Basingstoke, UK : Palgrave, 2001).
10. Campo, S., I. Perrigne, and Q. Vuong Asymmetry in First-Price Auctions with Affiliated Private Values Journal of Applied Econometrics 2 (2001 179 207. (Pubitemid 37282635)
11. Capra, M., J. Goeree, R. Gomez, and C. Holt Learning and Noisy Behavior in an Experimental Study of Imperfect Price Competition International Economic Review 43 (2002 613 636.
12. Charness, G., and M. Dufwenberg Promises & Partnership Econometrica 74 (2006 1579 1601.
13. Chen, K.Y., and C. Plott Nonlinear Behavior in Sealed Bid First-Price Auctions Games and Economic Behavior 25 (1998 34 78.
14. Costa-Gomes, M., and G. Weizsäcker Stated Beliefs and Play in Normal-Form Games Review of Economic Studies 75 (2008 729 762.
15. Cox, J., and R. Oaxaca Is Bidding Behavior Consistent with Bidding Theory for Private Value Auctions in R. M. Isaac, ed., Research in Experimental Economics, Vol. 6 (Greenwich, CT : JAI Press, 1996 131 148.
16. Cox, J., V. Smith, and J. Walker, Tests of a Heterogeneous Bidder's Theory of First-Price Auctions Economics Letters 12 (1983 207 212.
17. Cox, J., V. Smith, and J. Walker Experimental Development of Sealed-Bid Auction Theory: Calibrating Controls for Risk Aversion American Economic Review 75 (1985 160 165.
18. Cox, J., V. Smith, and J. Walker Theory and Individual Behavior of First-Price Auctions Journal of Risk and Uncertainty 1 (1988 61 99.
19. Croson, R. Thinking Like a Game Theorist: Factors Affecting the Frequency of Equilibrium Play Journal of Economic Behavior and Organization 41 (2000 299 314.
20. De Finetti, B. Methods of Discriminating Levels of Partial Knowledge Concerning a Test Item British Journal of Mathematical and Statistical Psychology 18 (1965 87 123.
21. Dorsey, R., and L. Razzolini Explaining Overbidding in First Price Auctions Using Controlled Lotteries Experimental Economics 6 (2003 123 140.
22. Dufwenberg, M., and U. Gneezy Measuring Beliefs in an Experimental Lost Wallet Game Games and Economic Behavior 30 (2000 163 182.
23. Friedman, D. Theory and Misbehavior of First-Price Auctions: Comment American Economic Review 82 (1992 1374 1378.
24. Gerking, S., M. DeHaan, and W. Schulze The Marginal Value of Job Safety: A Contingent Valuation Study Journal of Risk and Uncertainty 1 (1988 18 99.
25. Giordani, P., and P. Söderlind Is There Evidence of Pessimism and Doubt in Subjective Distributions? Implications for the Equity Premium Puzzle Journal of Economic Dynamics and Control 30 (2006 1027 1043.
26. Goeree, J., C. Holt, and T. Palfrey Quantal Response Equilibrium and Overbidding in Private-Value Auctions Journal of Economic Theory 104 (2002 247 272.
27. Golec, J., and M. Tamarkin Bettors Love Skewness, Not Risk, at the Horse Track Journal of Political Economy 106 (1998 205 225.
28. Gourieroux, C., and A. Monfort, Simulation-Based Econometric Methods (New York : Oxford University Press, 2002).
29. Harrison, G. Theory and Misbehavior of First-Price Auctions American Economic Review 79 (1989 749 762.
30. Harrison, G. Risk Attitudes in First-Price Auction Experiments: A Bayesian Analysis Review of Economics and Statistics 72 (1990 541 546.
31. Hickernell, F. J., H. S. Hong, P. L'Ecuyer, and C. Lemieux Extensible Lattice Sequences for Quasi-Monte Carlo Quadrature SIAM Journal on Scientific Computing 22 (2000 1117 1138.
32. Hurley, T., and J. Shogren An Experimental Comparison of Induced and Elicited Beliefs Journal of Risk and Uncertainty 30 (2005 169 188.
33. Isaac, M., and J. Walker Information and Conspiracy in Sealed Bid Auctions Journal of Economic Behavior and Organization 6 (1985 139 159.
34. Kagel, J. Auctions: A Survey of Experimental Research in J.H. Kagel, and A.E. Roth, eds., Handbook of Experimental Economics (Princeton, NJ : Princeton University Press, 1995 501 586.
35. Kagel, J., and A. Roth Theory and Misbehavior in First-Price Auctions: Comment American Economic Review 82 (1992 1379 1391.
36. Kahneman, D., and A. Tversky Prospect Theory: An Analysis of Decision under Risk Econometrica 47 (1979 263 291.
37. Lichtenstein, S., P. Slovic, B. Fischhoff, B. Layman, and B. Combs Judged Frequency of Lethal Events Journal of Experimental Psychology: Human Learning and Memory 4 (1978 551 578.
38. Manski, C. F. Identification of Decision Rules in Experiments on Simple Games of Proposal and Response European Economic Review 46 (2002 880 891.
39. Manski, C. F. Measuring Expectations Econometrica 72 (2004 1329 1376.
40. McKelvey, R., and T. Palfrey Quantal Response Equilibria for Normal Form Games Games and Economic Behavior 10 (1995 6 38.
41. McKelvey, R., and T. Palfrey Quantal Response Equilibria in Extensive Form Games Experimental Economics 1 (1998 9 41.
42. Murphy, A., and R. Winkler Scoring Rules in Probability Assessment and Evaluation Acta Psychologica 34 (1970 273 386.
43. Murphy, A., and R. Winkler Probability Forecasting in Meteorology Journal of the American Statistical Association 79 (1984 489 500.
44. Neugebauer, T., and R. Selten Individual Behavior of First-Price Sealed-Bid Auctions: The Importance of Information Feedback in Experimental Markets Mimeo, University of Bonn, 2003.
45. Nyarko, Y., and A. Schotter An Experimental Study of Belief Learning Using Elicited Beliefs Econometrica 70 (2002 971 1005.
46. Ottaviani, M., and P. Sørensen Forecasting and Rank-Order Contests Mimeo, London School of Economics, 2003.
47. Palfrey, T. R., and H. Rosenthal Testing Game-Theoretic Models of Free Riding: New Evidence on Probability Bias and Learning in T. Palfrey, ed., Contemporary Laboratory Research in Political Economy (Ann Arbor : University of Michigan Press, 1991).
48. Pezanis-Christou, P., and A. Romeu Structural Inferences from First-Price Auction Experiments Mimeo, Institut d'Anàlisi Econòmica, 2003.
49. Pezanis-Christou, P., and A. Sadrieh Elicited Bid Functions in (A)Symmetric First-Price Auctions Mimeo, Institut d'Anàlisi Econòmica, 2003.
50. Prelec, D. The Probability Weighting Function Econometrica 66 (1988 497 527.
51. Roth, A. Bargaining Experiments in J.H. Kagel, and A.E. Roth, eds., Handbook of Experimental Economics (Princeton, NJ : Princeton University Press, 1995 253 348.
52. Rutström, E., and N. Wilcox Learning, Belief Elicitation and Heterogeneity Mimeo, University of Houston, 2005.
53. Sanders, F. Skill in Forecasting Daily Temperature and Precipitation: Some Experimental Results Bulletin of the American Meteorological Society 54 (1973 1771 1779.
54. Savage, L. Elicitation of Personal Probabilities and Expectations Journal of the American Statistical Association 66 (1971 783 801.
55. Schotter, A., and B. Sopher Advice and Behavior in Intergenerational Ultimatum Games: An Experimental Approach Mimeo, New York University, 2001.
56. Selten, R., and J. Buchta Experimental Sealed Bid First Price Auctions with Directly Observed Bid Function in D. Budescu, I. Erev, and R. Zwick, eds., Games and Human Behavior - Essays in Honor of A. Rapoport (Mahwah, NJ : Lawrence Erlbaum Associates, Inc., 1999).
57. Shao, J., and D. Tu, The Jackknife and Bootstrap (New York : Springer-Verlag, 1995).
58. Viscusi, K., J. Hakes, and A. Carlin Measures of Mortality Risks Journal of Risk and Uncertainty 14 (1997 213 233. (Pubitemid 127429879)
59. Viscusi, K., and C. O'Connor Adaptive Responses to Chemical Labeling: Are Workers Bayesian Decision Makers? American Economic Review 74 (1984 942 956.
60. Vuong, Q. Likelihood Ratio Tests for Model Selection and Non-Nested Hypotheses Econometrica 57 (1989 307 333.
61. Wakker, P., R. Thaler, and A. Tversky Probabilistic Insurance Journal of Risk and Uncertainty 15 (1997 7 28.
62. Wilcox, N., and N. Feltovich Thinking Like a Game Theorist: Comment Mimeo, University of Houston, 2000.
63. Yi, K.-O. Quantal-Response Equilibrium Models of Order-Statistics Games Journal of Economic Behavior and Organization 51 (2003 413 425.