Related papers: The professional trader's paradox
We investigate the dynamics of a trust game on a mixed population where individuals with the role of buyers are forced to play against a predetermined number of sellers, whom they choose dynamically. Agents with the role of sellers are also…
Can a probabilistic gambler get arbitrarily rich when all deterministic gamblers fail? We study this problem in the context of algorithmic randomness, introducing a new notion -- almost everywhere computable randomness. A binary sequence…
We study the effects of individual perceptions of payoffs in two-player games. In particular we consider the setting in which individuals' perceptions of the game are influenced by their previous experiences and outcomes. Accordingly, we…
We study an evolutionary game of chance in which the probabilities for different outcomes (e.g., heads or tails) depend on the amount wagered on those outcomes. The game is perhaps the simplest possible probabilistic game in which…
A general framework is suggested to describe human decision making in a certain class of experiments performed in a trading laboratory. We are in particular interested in discerning between two different moods, or states of the investors,…
We study the mathematical properties of probabilistic processes in which the independent actions of $n$ players (`causes') can influence the outcome of each player (`effects'). In such a setting, each pair of outcomes will generally be…
Agents' judgment depends on perception and previous knowledge. Assuming that previous knowledge depends on perception, we can say that judgment depends on perception. So, if judgment depends on perception, can agents judge that they have…
We study a contextual version of the repeated brokerage problem. In each interaction, two traders with private valuations for an item seek to buy or sell based on the learner's-a broker-proposed price, which is informed by some contextual…
Parrondo's coin-tossing games comprise two games, $A$ and $B$. The result of game $A$ is determined by the toss of a fair coin. The result of game $B$ is determined by the toss of a $p_0$-coin if capital is a multiple of $r$, and by the…
In this article we will propose a completely new point of view for solving one of the most important paradoxes concerning game theory. The solution develop shifts the focus from the result to the strategy s ability to operate in a cognitive…
When aggregating logically interconnected judgments from $n$ agents, the result might be inconsistent with the logical connection. This inconsistency is known as the doctrinal paradox, which plays a central role in the field of judgment…
Large parts of professional human communication proceed in a request-reply fashion, whereby requests contain specifics of the information desired while replies can deliver the required information. However, time limitations often force…
The recently discovered Parrondo's paradox claims that two losing games can result, under random or periodic alternation of their dynamics, in a winning game: "losing+losing=winning". In this paper we follow Parrondo's philosophy of…
We study a dynamic game where an expert sends probabilistic forecasts to a decision-maker. The decision-maker verifies these forecasts using a calibration test based on past data. How should the expert send forecasts to maximize her payoff…
A new simple model of financial market is proposed, based on the sequential and inter-temporal nature of trader-trader interaction, and on a new simple trading strategy space. In this pattern-based speculation model, the traders open and…
We consider a financial market in which traders potentially face restrictions in trading some of the available securities. Traders are heterogeneous with respect to their beliefs and risk profiles, and the market is assumed thin: traders…
The Deviants' Dilemma is a two-person game with the individual gain conflicting with the choice for global good. Evolutionary considerations yield fixed point attractors, with the phenomena of exclusion potentially playing an important role…
We propose a game-theoretic framework that incorporates both incomplete information and general ambiguity attitudes on factors external to all players. Our starting point is players' preferences on payoff-distribution vectors, essentially…
Traders buy and sell financial instruments in hopes of making profit, and brokers are responsible for the transaction. There are several hypotheses and conspiracy theories arguing that in some situations, brokers want their traders to lose…
The "paradox" arises in the Two Envelopes Paradox from the incorrect formulation of the argument. The infomation given is misused and therefore the results are incorrect for the question asked. The key is to be clear on what question we are…