Cyclic motions in Dekel-Scotchmer Game Experiments

TL;DR

This paper reanalyzes Dekel-Scotchmer game experiments and finds evidence of persistent cycles in social states, supporting evolutionary dynamics models like TASP that predict such cyclic behavior.

Contribution

It provides new evidence of cycles in Dekel-Scotchmer games, confirming predictions of the TASP evolutionary model through reanalysis of experimental data.

Findings

Persistent cycles confirmed in Dekel-Scotchmer games

Experimental data supports evolutionary cycle predictions

Reanalysis method reveals cycles previously undetected

Abstract

TASP (Time Average Shapley Polygon, Bena{\=\i}m, Hofbauer and Hopkins, \emph{Journal of Economic Theory}, 2009), as a novel evolutionary dynamics model, predicts that a game could converge to cycles instead of fix points (Nash equilibria). To verify TASP theory, using the four strategy Dekel-Scotchmer games (Dekel and Scotchmer, \emph{Journal of Economic Theory}, 1992), four experiments were conducted (Cason, Friedman and Hopkins, \emph{Journal of Economic Theory}, 2010), in which, however, reported no evidence of cycles (Cason, Friedman and Hopkins, \emph{The Review of Economic Studies}, 2013). We reanalysis the four experiment data by testing the stochastic averaging of angular momentum in period-by-period transitions of the social state. We find, the existence of persistent cycles in Dekel-Scotchmer game can be confirmed. On the cycles, the predictions from evolutionary models had been supported by the four experiments.