Endogenous Barriers to Learning

Fuente: arXiv
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Auteur principal: Compte, Olivier
Format: Preprint
Publié: 2023
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author Compte, Olivier
author_facet Compte, Olivier
contents Building on the idea that lack of experience is a source of errors but that experience should reduce them, we model agents' behavior using a stochastic choice model (logit quantal response), leaving endogenous the accuracy of their choices. In some games, higher accuracy leads to unstable logit-response dynamics. Starting from the lowest possible accuracy, we define the barrier to learning as the maximum accuracy which keeps the logit-response dynamic stable (for all lower accuracies). This defines a limit quantal response equilibrium. We apply the concept to centipede, travelers' dilemma, and 11-20 money-request games and to first-price and all-pay auctions, and discuss the role of strategy restrictions in reducing or amplifying barriers to learning.
format Preprint
id arxiv_https___arxiv_org_abs_2306_16904
institution arXiv
publishDate 2023
record_format arxiv
spellingShingle Endogenous Barriers to Learning
Compte, Olivier
General Economics
Economics
Building on the idea that lack of experience is a source of errors but that experience should reduce them, we model agents' behavior using a stochastic choice model (logit quantal response), leaving endogenous the accuracy of their choices. In some games, higher accuracy leads to unstable logit-response dynamics. Starting from the lowest possible accuracy, we define the barrier to learning as the maximum accuracy which keeps the logit-response dynamic stable (for all lower accuracies). This defines a limit quantal response equilibrium. We apply the concept to centipede, travelers' dilemma, and 11-20 money-request games and to first-price and all-pay auctions, and discuss the role of strategy restrictions in reducing or amplifying barriers to learning.
title Endogenous Barriers to Learning
topic General Economics
Economics
url https://arxiv.org/abs/2306.16904