Bandits in the Lab
Article [Version of Record]
Publisher(s)Université de Montréal. Département de sciences économiques.
We test Keller, Rady, Cripps’ (2005) game of strategic experimentation with exponential bandits in the laboratory. We find strong support for the prediction of free-riding because of strategic concerns. We also find strong evidence for behavior that is characteristic of Markov perfect equilibrium: non-cutoff behavior, lonely pioneers and frequent switches of action.