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Risk averse behavior in generalized matching pennies games

Goeree, Jacob K. and Palfrey, Thomas R. and Holt, Charles A. (2003) Risk averse behavior in generalized matching pennies games. Games and Economic Behavior, 45 (1). pp. 97-113. ISSN 0899-8256. doi:10.1016/S0899-8256(03)00052-6.

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In experimental studies of behavior in 2×2 games with unique mixed strategy equilibria, observed choice frequencies are systematically different from mixed-strategy Nash predictions. This paper examines experimental results for a variety of such games, and shows that a structural econometric model which incorporates risk aversion into a quantal response equilibrium explains the data very well. Moreover, risk aversion estimates are stable across the different games and are close to those obtained from laboratory and field auction data, as well as from individual lottery choice experiments.

Item Type:Article
Related URLs:
URLURL TypeDescription
Goeree, Jacob K.0000-0001-9876-3425
Palfrey, Thomas R.0000-0003-0769-8109
Additional Information:© 2003 Elsevier. Received 15 November 2000. This research was funded in part by the National Science Foundation (SBR-0094800 and SES-0079301) and by the John D. Hacker Social Science Experimental Laboratory at Caltech. We are grateful to two anonymous referees for useful suggestions, and to Sean Gailmard, Serena Guarnaschelli, and Vale Murthy for their assistance in conducting the experiments.
Funding AgencyGrant Number
Caltech Social Science Experimental LaboratoryUNSPECIFIED
Subject Keywords:Matching pennies; Quantal response equilibrium; Risk aversion; Experiments
Issue or Number:1
Classification Code:JEL classification C72; C92
Record Number:CaltechAUTHORS:20160303-153844769
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Official Citation:Jacob K. Goeree, Charles A. Holt, Thomas R. Palfrey, Risk averse behavior in generalized matching pennies games, Games and Economic Behavior, Volume 45, Issue 1, October 2003, Pages 97-113, ISSN 0899-8256, (
Usage Policy:No commercial reproduction, distribution, display or performance rights in this work are provided.
ID Code:65053
Deposited On:06 Mar 2016 17:08
Last Modified:10 Nov 2021 23:39

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