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The speculation game is an agent-based toy model to investigate the dynamics of the financial market. Our model has achieved the reproduction of 10 of the well-known stylized facts for financial time series. However, there is also a…
While fictitious play is guaranteed to converge to Nash equilibrium in certain game classes, such as two-player zero-sum games, it is not guaranteed to converge in non-zero-sum and multiplayer games. We show that fictitious play in fact…
Economists often estimate economic models on data and use the point estimates as a stand-in for the truth when studying the model's implications for optimal decision-making. This practice ignores model ambiguity, exposes the decision…
The state of economic theory and accumulated facts from the different branches of the economic science require to analyze the concept of the description of economy systems. The economic reality generates the problems the solution of that is…
Successful design of human-in-the-loop control systems requires appropriate models for human decision makers. Whilst most paradigms adopted in the control systems literature hide the (limited) decision capability of humans, in behavioral…
We elicit incomplete preferences over monetary gambles with subjective uncertainty. Subjects rank gambles, and these rankings are used to estimate preferences; payments are based on estimated preferences. About 40\% of subjects express…
We introduce a new measure of the discrepancy in strategic games between the social welfare in a Nash equilibrium and in a social optimum, that we call selfishness level. It is the smallest fraction of the social welfare that needs to be…
Why do societies remain stuck in inferior institutions even when superior al ternatives are widely recognized? This paper develops a model in which agents choose not only actions within a game but also transformations of the game it self.…
We report the results of a game-theoretic experiment with human players who solve the problems of increasing complexity by cooperating in groups of increasing size. Our experimental environment is set up to make it complicated for players…
Congestion games model a wide variety of real-world resource congestion problems, such as selfish network routing, traffic route guidance in congested areas, taxi fleet optimization and crowd movement in busy areas. However, existing…
Data-driven decision-making consequential to individuals raises important questions of accountability and justice. Indeed, European law provides individuals limited rights to 'meaningful information about the logic' behind significant,…
We consider a stochastic tournament game in which each player is rewarded based on her rank in terms of the completion time of her own task and is subject to cost of effort. When players are homogeneous and the rewards are purely rank…
We review the literature on models that try to explain human behavior in social interactions described by normal-form games with monetary payoffs. We start by covering social and moral preferences. We then focus on the growing body of…
Allocating conflicting jobs among individuals while respecting a budget constraint for each individual is an optimization problem that arises in various real-world scenarios. In this paper, we consider the situation where each individual…
The game in which acts of participants don't have an adequate description in terms of Boolean logic and classical theory of probabilities is considered. The model of the game interaction is constructed on the basis of a non-distributive…
The thesis of this essay is that, in heterogeneous agent macroeconomics, the assumption of rational expectations about equilibrium prices is unrealistic and should be replaced. Rational expectations imply that decision makers forecast…
Econometric models of strategic interactions among people or firms have received a great deal of attention in the literature. Less attention has been paid to the role of the underlying assumptions about the way agents form beliefs about…
One of the most remarkable things about the human moral mind is its flexibility. We can make moral judgments about cases we have never seen before. We can decide that pre-established rules should be broken. We can invent novel rules on the…
Humanity has been fascinated by the pursuit of fortune since time immemorial, and many successful outcomes benefit from strokes of luck. But success is subject to complexity, uncertainty, and change - and at times becoming increasingly…
Envy-freeness and the relaxation to Envy-freeness up to one item (EF-1) have been used as fairness concepts in the economics, game theory, and social choice literatures since the 1960s, and have recently gained popularity within the…