Document Type
Discussion Paper
Publication Date
9-1-2003
CFDP Number
1432
CFDP Pages
22
Abstract
The quantal response equilibrium (QRE) notion of McKelvey and Palfrey (1995) has recently attracted considerable attention, due largely to its widely documented ability to rationalize observed behavior in games played by experimental subjects. We show that this ability to fit the data, as typically measured in this literature, is uninformative. Without a priori distributional assumptions, a QRE can match any distribution of behavior by each player in any normal form game. We discuss approaches that might be taken to provide valid empirical evaluation of the QRE and discuss its potential value as an approximating empirical structure.
Recommended Citation
Haile, Philip A.; Hortaçsu, Ali; and Kosenok, Grigory, "On the Empirical Content of Quantal Response Equilibrium" (2003). Cowles Foundation Discussion Papers. 1705.
https://elischolar.library.yale.edu/cowles-discussion-paper-series/1705