Transactions of the Institute of Systems, Control and Information Engineers
Online ISSN : 2185-811X
Print ISSN : 1342-5668
ISSN-L : 1342-5668
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Correlated Equilibrium in Network Formation and its Experiment
Ichiro NishizakiTomohiro HayashidaRika Kambara
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2012 Volume 25 Issue 7 Pages 163-171

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Abstract

So far, it has been tried to explain the behavior on experimental subjects in experiments on network formation by a solution concept of the strict Nash equilibrium. In this paper, we consider the correlated equilibrium for network formation which is a solution concept based on stability in terms of expected payoff maximization assuming coordination or implicit agreement between players. To examine its validity, we conduct a laboratory experiment and try to explain the behavior of the experimental subjects. As a result of the experiment, we find that although the explanation by the strict Nash equilibrium is difficult, it is possible to explain by the correlated equilibrium or inequity aversion.

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© 2012 The Institute of Systems, Control and Information Engineers
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