The Guessing game
The Guessing game:
Each one has to pick a number between 0 and 100. The person that comes closest to 2/3 of the average receives a prize of $ . Write it down, with your name (so I can identify the winner).
1
Your choices:
_____ _____ _____ _____ _____ _____ _____ _____ _____ _____ 0 5 10 15 20 25 30 35 40 45 50
2
Can we make sense of what people choose? Steps of reasoning: 1: best response to random, 2: best response to 1 players...
3
What is the Nash Equilibrium? What is the unique set of strategies that survive iterated elimination of weakly dominated strategies? Why would you not want to play the NE? Why do you think people did not (do not) play 0?
4
How can we design an experiment to tease apart why people do not chose 0:
1. Because they do not understand that 0 is the Nash equilibrium?
2. Because they think other people do not understand what the Nash equilibrium is?
5
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