The trust game is a two player game with three stages, often used in economics exper- iments to measure trust and trustworthiness. Player 1 starts off with 10 Dollars. She can send an amoun0≤x≤ 10 to player 2. The experimenter triples the sent amount such that player 2 receives 3x. Player 2 can then send an amount 0 ≤ y ≤ 3r to player 1. (a) Draw a diagram of the extensive form of this game. (b) Find all the SPNE in the trust game. (c) Why is this game used to measure trust and trustworthiness? Do you think it provides reasonable measures? How would you interpret reciprocity in this game? How would you detect it? What is trust? Come up with a operational definition.
The trust game is a two player game with three stages, often used in economics exper- iments to measure trust and trustworthiness. Player 1 starts off with 10 Dollars. She can send an amoun0≤x≤ 10 to player 2. The experimenter triples the sent amount such that player 2 receives 3x. Player 2 can then send an amount 0 ≤ y ≤ 3r to player 1. (a) Draw a diagram of the extensive form of this game. (b) Find all the SPNE in the trust game. (c) Why is this game used to measure trust and trustworthiness? Do you think it provides reasonable measures? How would you interpret reciprocity in this game? How would you detect it? What is trust? Come up with a operational definition.
Managerial Economics: A Problem Solving Approach
5th Edition
ISBN:9781337106665
Author:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Publisher:Luke M. Froeb, Brian T. McCann, Michael R. Ward, Mike Shor
Chapter18: Auctions
Section: Chapter Questions
Problem 18.1IP
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