Statistical Inference in Games

Yuval Salant*, Josh Cherry

*Corresponding author for this work

Research output: Contribution to journalArticle

1 Scopus citations

Abstract

We consider statistical inference in games. Each player obtains a small random sample of other players' actions, uses statistical inference to estimate their actions, and chooses an optimal action based on the estimate. In a sampling equilibrium with statistical inference (SESI), the sample is drawn from the distribution of players' actions based on this process. We characterize the set of SESIs in large two-action games, and compare their predictions to those of Nash equilibrium, and for different sample sizes and statistical inference procedures. We then study applications to competitive markets, markets with network effects, monopoly pricing, and search and matching markets.

Original languageEnglish (US)
Pages (from-to)1725-1752
Number of pages28
JournalEconometrica
Volume88
Issue number4
DOIs
StatePublished - Jul 1 2020

Keywords

  • bounded rationality
  • games
  • search and matching markets
  • Statistical inference

ASJC Scopus subject areas

  • Economics and Econometrics

Fingerprint Dive into the research topics of 'Statistical Inference in Games'. Together they form a unique fingerprint.

  • Cite this