Stephan Jagau
I am an experimentalist and economic theorist interested in the foundations of game- and decision theory, as well as in evolutionary theory. My most recent experimental work studies payoff- and risk-dominance in one-shot coordination games using a no-feedback, choice list-like design. My latest theoretical work concerns beliefs and reasoning in infinite games as well as the identification of preferences in strategic settings. I am also co-Pi of an ongoing NSF-grant project implementing selection pressure in online decision-making experiments.
I am a postdoctoral scholar at UC Irvine's Department of Economics working with Donald G. Saari and John Duffy. I am also a member of Maastricht University's EPICENTER. I did my Economics Ph.D. at CREED (University of Amsterdam) and at the Tinbergen Institute, supervised by Theo Offerman and Matthijs van Veelen.
Next to my experimental research at UC Irvine's ESSL Lab, I am co-directing an initiative to virtualize experimentation using Kubernetes and to build an Experimental Social Science Research Network (ESSRN). ESSRN will seamlessly accommodate classical and online experiments on a vast and diverse multi-institutional subject pool, blurring the lines between the traditional lab setup and platforms such as Heroku and mTurk. With support from the National Research Platform, the first iteration of ESSRN will be launched between UC's Berkeley, Davis, Irvine, and Santa Barbara in early 2023.
Publications
Common Belief in Rationality in Psychological Games: Belief-Dependent Utility
and the Limits of Strategic Reasoning. (with Andrés Perea)
Journal of Mathematical Economics (2022) 100, 102635. Paper
Defaults, normative anchors, and the occurrence of risky and cautious shifts.
(with Theo Offerman) Journal of Risk and Uncertainty (2018) 56(3), 211-236. Paper
A general evolutionary framework for the role of intuition and deliberation
in cooperation. (with Matthijs van Veelen) Nature Human Behaviour (2017) 1(8), 0152.
Paper, Supplementary Information, News & Views (Adam Bear and David Rand)
Grants and Fellowships
Selection Pressure in Strategic Environments. Link
(co-PI with John Duffy), National Science Foundation #2214979, 07/2022 – 06/2024, $327,637.
Experimental Social Science Research Network. Link
(co-PI with John Duffy & Michael McBride), UCI Seed Funding Program, 04/2022 – 04/2024, $149,929.
Reason within Passions: Towards an Economic Theory of Emotions. Link
Rubicon Postdoctoral Fellowship, Dutch Research Council 019.181SG.023,
November 2018 – December 2020, Euro 134,386.
Working Papers
To Catch a Stag: Identifying payoff- and risk-dominance effects in coordination games.
(Experimental Job Market Paper) Full Paper, Slides
Abstract: Five decades after Harsanyi and Selten’s seminal work on equilibrium selection, we remain unable to predict the outcomes of real-life coordination even in simple cases. One reason is that experiments have struggled to quantify the effects of payoff- and risk-dominance and to separate them from context factors like feedback, repetition, and complexity. This experiment is the first to demonstrate that both payoff- and risk-dominance significantly and independently impact coordination decision-making. Three innovations characterize the design: First, payoff- and risk-dominance are disentangled using orthogonal measures of strategic incentives and welfare externalities. Second, a no-feedback, choice-list format minimizes deviations from one-shot incentives. Third, beliefs about others’ behavior are elicited next to decisions. Surprisingly, beliefs do not only drive the effect of risk dominance but also the one of payoff dominance. This is in line with subjects viewing efficient coordination as a "team"-problem.
The Fundamental Theorem of Epistemic Game Theory. (Theoretical Job Market Paper)
Reject & resubmit Econometrica. Full Paper, Slides
Abstract: In many applications of game theory, infinite strategy sets stand in for large finite strategy sets. It is then expected that results back-translate from infinite to finite. Transfinite non-best reply eliminations in infinite games raise concerns whether this always works. In response, a measure-theoretic characterization of common belief in rationality via two alternative procedures is developed. Procedure one is transfinite non-best reply elimination. Procedure two, elimination of non-best replies and supporting beliefs, avoids all transfinite iterations. Thus, transfinite non-best reply eliminations never require infinite reasoning depths, and infinite-game results always back-translate to the finite. The real cause of transfinite eliminations turns out to be non-best reply elimination itself. That procedure ignores belief-based information that is critical for strategic rationality in infinite games.
Additive Context-Dependent Preferences. Extended Abstract, Slides
Abstract: “Money equals utility” is a much criticized ‘axiom’ that is central across a vast range of economic experiments and theory. Subjecting this ‘axiom’ to experimental testing requires an empirically tractable theory of context-dependent preferences. This paper presents novel behavioral foundations for additive context-dependent preferences and state-dependent expected utility. Crucially, these behavioral foundations do not require empirically implausible comparisons of alternatives across different states. Moreover, they can handle any state-dependent, multi-alternative decision problem. In particular, no diversity-type assumptions are used. A central application is to direct utility measurement in games, enabling a causal understanding of how e.g. risk attitudes and other-regarding concerns affect strategic choice.
The Incompatibility of Admissibility and Equilibrium. (with Christian Bach)
Extended Abstract
Abstract: Iterated admissibility and equilibrium are two fundamental solution concepts in non-cooperative games. An epistemic analysis reveals that they entail logically conflicting requirements on players’ beliefs. Strategic reasoning that combines equilibrium and iterated admissibility is impossible for all but a small class of normal-form games. For this restricted class, the resulting “admissible equilibrium” selects fully mixed undominated perfect equilibria.