Dictators and Trust in the Laboratory
If all players in the world were robots programmed to play Nash equilibrium strategies, then the study of game theory could bypass any need to discuss concepts like utility or report on emotional or “irrational” play as I have done with prospect theory, neuroeconomics, and behavioral economics in general.
But, since we are human, any study of strategic interaction needs to include behavioral findings. Psychological motivators like trust may play no role in Nash equilibrium analysis, but they are central to situations where collective payoffs may be improved through nonequilibrium play.
Just as sciences like physics have both a theoretical and experimental side—where the experiments show whether the theory ...