Public Statistics and Private Experience: Varying Feedback Information in a Take-or-Pass Game

David Danz (1, 2) , Steffen Huck (3, 2) , Philippe Jehiel (4, 5)

1 TU - Technical University of Berlin / Technische Universität Berlin
2 WZB - Wissenschaftszentrum fur Sozialforschung
3 UCL - University College of London [London]
4 PSE - Paris-Jourdan Sciences Economiques
5 PSE - Paris School of Economics

We study how subjects in an experiment use different forms of public information about their opponents' past behavior. In the absence of public information, subjects appear to use rather detailed statistics summarizing their private experiences. If they have additional public information, they make use of this information even if it is less precise than their own private statistics – except for very high stakes. Making public information more precise has two consequences: It is also used when the stakes are very high and it reduces the number of subjects who ignore any information – public and private. That is, precise public information crowds in the use of own information. Finally, our results shed some light on unraveling in centipede games.

Mots clés: public information

Domaines: Economies et finances

David Danz, Steffen Huck, Philippe Jehiel. Public Statistics and Private Experience: Varying Feedback Information in a Take-or-Pass Game. German Economic Review, 2016, Special Issue in Honor of Reinhard Selten's 85th Birthday 17 (3), pp.359-377. ⟨10.1111/geer.12098⟩. ⟨halshs-01497368⟩