Belief formation in a signaling game without common prior: an experiment

Article

Abstract

Using belief elicitation, the paper investigates the process of belief formation and evolution in a signaling game in which a common prior is not induced. Both prior and posterior beliefs of Receivers about Senders’ types are elicited, as well as beliefs of Senders about Receivers’ strategies. In the experiment, subjects often start with diffuse uniform beliefs and update them in view of observations. However, the speed of updating is influenced by the strength of initial beliefs. An interesting result is that beliefs about the prior distribution of types are updated slower than posterior beliefs, which incorporate Senders’ strategies. In the medium run, for some specifications of game parameters, this leads to outcomes being significantly different from the outcomes of the game in which a common prior is induced. It is also shown that elicitation of beliefs does not considerably change the pattern of play in this game.

Keywords

Beliefs Signaling Experiment Learning Belief elicitation 

Supplementary material

11238_2017_9614_MOESM1_ESM.pdf (101 kb)
Supplementary material 1 (pdf 100 KB)

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Copyright information

© Springer Science+Business Media, LLC 2017

Authors and Affiliations

  1. 1.Centre for Decision Research and Experimental Economics (CeDEx), School of EconomicsUniversity of NottinghamNottinghamUK

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