Skip to main content

Hot versus cold behavior in centipede games


There is a long-standing unresolved debate in game theory and experimental economics regarding the behavioral equivalence of the direct-response method (hot play) and the strategy method (cold play). Using a unified experimental framework, we compare behavior elicited via both methods in four different Centipede Games that differ in their incentives to take or pass, in the evolution of those incentives over decision nodes, and in the asymmetry of the incentives across the two player roles. Out of the four Centipede Games, we find that both methods yield statistically different behavior in two of them, while in the remaining two we cannot reject the same behavior across the hot and cold methods. Whenever the behavior diverges, hot play consistently makes individuals stop earlier. These findings should shift the question from whether both methods are generically behaviorally equivalent to under which conditions they are (not) and why.

This is a preview of subscription content, access via your institution.

Fig. 1
Fig. 2


  1. Kawagoe and Takizawa (2012) scale the payoffs in the constant CG up to balance the incentives across the two CGs.

  2. Given the matching protocol in this treatment, the number of participants did not have to be even.

  3. The distributions of behavior do not differ between the two places, in which we conducted our experiment. We performed two different tests of independence of the two samples for each game: Fisher's exact test of independence and two-sample Kolmogorov-Smirnov test. No test rejects the equality of both distributions (\(p=0.14\) and \(p=0.22\) for CG1; \(p=1.00\) and \(p=1.00\) for CG2; \(p=1.00\) and \(p=1.00\) for CG3; \(p=0.8\) and \(p=1.00\) for CG4).

  4. In all rounds, there are five independent observations (different matching groups) for each CG.

  5. Figure A.3 in Online Supplement A.1 reports stopping probabilities conditional on reaching a particular decision node (rather than the distribution of reached decision nodes) showing similar results.

  6. Tests of proportions in Table A.1 in Online Supplement A.1 corroborate the results reported in the main text.

  7. We find little evidence of learning over rounds in the hot treatment. See the additional analysis in Online Supplement A.2.


  • Brandts, J., & Charness, G. (2011). The strategy versus the direct-response method: a first survey of experimental comparisons. Experimental Economics, 14(3), 375–398.

    Article  Google Scholar 

  • Charness, G., Gneezy, U., & Halladay, B. (2016). Experimental methods: Pay one or pay all. Journal of Economic Behavior and Organization, 131, 141–150.

    Article  Google Scholar 

  • Fey, M., McKelvey, R. D., & Palfrey, T. (1996). An experimental study of constant-sum centipede games. International Journal of Game Theory, 25, 269–287.

    Article  Google Scholar 

  • Fischbacher, U. (2007). z-Tree: Zurich toolbox for ready-made economic experiments. Experimental Economics, 10(2), 171–178.

    Article  Google Scholar 

  • Greiner, B. (2015). Subject pool recruitment procedures: Organizing experiments with ORSEE. Journal of the Economic Science Association, 1(1), 114–125.

    Article  Google Scholar 

  • García-Pola, B., Iriberri, N., & Kovářík, J. (2020). Non-equilibrium play in centipede games. Games and Economic Behavior, 120, 391–433.

    Article  Google Scholar 

  • Kawagoe, T., & Takizawa, H. (2012). Level-k analysis of experimental centipede games. Journal of Economic Behavior and Organization, 82(2), 548–566.

    Article  Google Scholar 

  • Levitt, S. D., List, J. A., & Sadoff, S. E. (2011). Checkmate: Exploring backward induction among chess players. American Economic Review, 101(2), 975–90.

    Article  Google Scholar 

  • Loewenstein, G. (1996). Out of control: Visceral influences on behavior. Organizational Behavior and Human Decision Processes, 65(3), 272–292.

    Article  Google Scholar 

  • McKelvey, R. D., & Palfrey, T. R. (1992). An experimental study of the centipede game. Econometrica, 60(4), 803–836.

    Article  Google Scholar 

  • Nagel, R., & Tang, F. F. (1998). Experimental results on the centipede game in normal form: an investigation on learning. Journal of Mathematical Psychology, 42, 356–384.

    Article  Google Scholar 

  • Palacios-Huerta, I., & Volij, O. (2009). Field centipedes. The American Economic Review, 99(4), 1619–1635.

    Article  Google Scholar 

  • Rapoport, A., Stein, W. E., Parco, J. E., & Nicholas, T. E. (2003). Equilibrium play and adaptive learning in a three-person centipede game. Games and Economic Behavior, 43(2), 239–265.

    Article  Google Scholar 

  • Rosenthal, R. W. (1981). Games of perfect information, predatory pricing and chain store paradox. Journal of Economic Theory, 25, 92–100.

    Article  Google Scholar 

  • Roth, A. E. (1995). Bargaining experiments. Handbook of Experimental Economics, 1995, 253–348.

    Google Scholar 

Download references


Financial support from the Departamento Vasco de Educación, Política Linguística y Cultura (IT1367-19 and IT1336-19), Ministerio de Economía y Competividad and Fondo Europeo de Desarrollo Regional (ECO 2015-64467-R, ECO 2015-66027-P, PID2019-106146GB-I00, and PID2019-108718GB-I00 MINECO/FEDER), and GAČR (17-25222S) is gratefully acknowledged.

Author information

Authors and Affiliations


Corresponding author

Correspondence to Jaromír Kovářík.

Additional information

Publisher's Note

Springer Nature remains neutral with regard to jurisdictional claims in published maps and institutional affiliations.

N. Iriberri: IKERBASQUE, Basque Foundation for Research.

J. Kovářík: CERGE-EI, a joint workplace of Charles University in Prague and the Economics Institute of the Czech Academy of Sciences, Politických vĕznů 7, 111 21 Prague, Czech Republic.

Electronic supplementary material

Below is the link to the electronic supplementary material.

Supplementary file1 (PDF 1941 kb)

Rights and permissions

Reprints and Permissions

About this article

Verify currency and authenticity via CrossMark

Cite this article

García-Pola, B., Iriberri, N. & Kovářík, J. Hot versus cold behavior in centipede games. J Econ Sci Assoc 6, 226–238 (2020).

Download citation

  • Received:

  • Revised:

  • Accepted:

  • Published:

  • Issue Date:

  • DOI:


  • Centipede games
  • Direct method
  • Strategy method
  • Experiments

JEL Classification

  • C72
  • C91
  • D91