Strategic sophistication of individuals and teams: Experimental evidence

Matthias Sutter, Simon Czermak, Francesco Feri

Research output: Contribution to journalArticlepeer-review


Many important decisions require strategic sophistication. We examine experimentally whether teams act more strategically than individuals. We let individuals and teams make choices in simple games, and also elicit first- and second-order beliefs. We find that teams play the Nash equilibrium strategy significantly more often, and their choices are more often a best response to stated first order beliefs. Distributional preferences make equilibrium play less likely. Using a mixture model, the estimated probability to play strategically is 62% for teams, but only 40% for individuals. A model of noisy introspection reveals that teams differ from individuals in higher order beliefs.
Original languageEnglish
JournalEuropean Economic Review
Early online date19 Jun 2013
Publication statusPublished - 2013

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