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- W2123102571 abstract "In this paper we investigate how cognitive ability influences behavior, success and the evolution of play towards Nash equilibrium in repeated strategic interactions. We study behavior in a p-beauty contest experiment and find striking differences according to cognitive ability: more cognitively able subjects choose numbers closer to equilibrium, converge more frequently to equilibrium play and earn more even as behavior approaches the equilibrium prediction. To understand better how subjects with different cognitive abilities learn differently, we estimate a structural model of learning based on level-k reasoning. We find a systematic positive relationship between cognitive ability and levels; furthermore, the average level of more cognitively able subjects responds positively to the cognitive ability of their opponents, while the average level of less cognitively able subjects does not respond at all. Our results suggest that, in strategic environments, higher cognitive ability translates into better analytic reasoning and a better ‘theory of mind’." @default.
- W2123102571 created "2016-06-24" @default.
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- W2123102571 date "2012-01-01" @default.
- W2123102571 modified "2023-10-13" @default.
- W2123102571 title "Cognitive Ability and Learning to Play Equilibrium: A Level-<i>k</i> Analysis" @default.
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- W2123102571 doi "https://doi.org/10.2139/ssrn.2043336" @default.
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