Andrew Kloosterman


Kloosterman, Andrew. An Experimental Study of Public Information in the Asymmetric Partnership Game Southern Economic Journal, 2019, 85(3), pp. 663-690.
Kloosterman, Andrew and Paul, Stephen. Ultimatum Game Bargaining in a Partially Directed Search Market Journal of Economic Behavior & Organization, 2018, 154, pp. 60-74.
Kloosterman, Andrew and Schotter, Andrew. Complementary Institutions and Economic Development: An Experimental Study Games and Economic Behavior, 2016, 99, pp. 186-205.
Kloosterman, Andrew. Directed Search with Heterogeneous Firms: An Experimental Study Experimental Economics, 2016, 19(1), pp. 51-66.
Kloosterman, Andrew. Public Information in Markov Games Journal of Economic Theory, 2015, 157, pp. 28-48.

Working Papers


A Simple Experimental Test of the Coase Conjecture: Fairness in Dynamic Bargaining (joint with Jack Fanning)
In each round of an infinite horizon bargaining game, a proposer proposes a division of chips, until a responder accepts. The Coase conjecture predicts that private information about responders' preferences for fairness leads to almost immediate agreement on an equal payoff split when discounting between rounds is small. We experimentally test this prediction when chips are equally valuable to both bargainers and when they are worth three times as much to proposers, and compare outcomes to an ultimatum game. Behavior offers strong support for the theory. In particular, when chips are more valuable to proposers, initial offers, initial minimum acceptable offers, responder payoffs and efficiency are significantly larger in the infinite horizon game than in the ultimatum game, and the differences in magnitude are large.

Stochastic/Repeated Games

Cooperation when Strategic Risk is Removed
Laboratory experiments on the infinitely repeated prisoner's dilemma, and other similar cooperation games, find little cooperation when the discount factor is near the theoretical cutoff discount factor for which co- operation is supported in equilibrium. The explanation is that the non-cooperative equilibrium is the best response to most beliefs, and thus is less risky in regards to strategic uncertainty. I study a new game where this property is reversed, the cooperative equilibrium is the best response to most beliefs at the theoretical cutoff. The main finding is that there is still not rampant cooperation, just 41% and 35% in period 0 of the game for the last 10 matches for the two respective parametrizations. This indicates that there is something more than just risk that inhibits cooperation.

Repeated Partnerships with Multiple Equilibria and Imperfect Monitoring: An Experimental Study
I investigate finitely repeated partnership games with imperfect monitoring where both mutual effort and mutual shirking are Nash equilibria of the stage game. The treatment variable is the number of repetitions. I find that period 1 effort rates are increasing in the number of repetitions, but subjects use trigger strategies that switch to permanent shirking after enough failed projects so effort rates decrease as the game progresses in all treatments. Additionally, the rate of decrease is less when there are more repetitions. These results are consistent with a theory of strategic uncertainty in which a subject best responds to their beliefs about whether their partner exerts effort or shirks. Finally, I show that total effort does not vary much as the number of repetitions is increased because the increased period 1 effort is mostly canceled out by the erosion of effort as the game progresses.

Cooperation in Stochastic Games: A Prisoner's Dilemma Experiment
This experiment investigates a stochastic version of the infinitely repeated prisoner's dilemma. The stochastic element introduces the importance of beliefs about the future for supporting cooperation as well as cooperation and defection on the equilibrium path. There is more cooperation in treatments where beliefs predict cooperation after subjects gain sufficient experience. There is some evidence for cooperation and defection as predicted by equilibrium, but there is stronger evidence for behavior conditioning on past actions that is not consistent with equilibrium play. This latter finding is confirmed with a maximum likelihood strategy estimation where the repeated game strategies Grim Trigger and Tit-for-Tat are the most prevalent cooperative strategies, although they are not equilibria in this environment.

School Choice

Essentially Stable Matchings (joint with Peter Troyan and David Delacrétaz)
We propose a solution to the conflict between fairness and efficiency in matching markets. A matching is essentially stable if any priority-based claim initiates a chain of reassignments that results in the initial claimant losing the object. We show that an essentially stable and Pareto efficient matching always exists and investigate the properties of the set of essentially stable matchings. We then classify popular Pareto efficient mechanisms: those based on Shapley and Scarf's TTC mechanism are not essentially stable, while Kesten's EADA mechanism is. The simplicity of our concept makes it particularly well-suited for practical applications.

School Choice with Asymmetric Information: Priority Design and the Curse of Acceptance (joint with Peter Troyan)
We generalize standard school choice models by allowing for interdependent preferences and differentially-informed students. We show that in general, the commonly-used deferred acceptance mechanism is no longer strategy-proof, the outcome is not (ex-post) stable, and may make less informed students worse off. We attribute these results to a curse of acceptance. However, we also show that if priorities are designed appropriately, positive results are recovered: equilibrium strategies are simple, the outcome is ex-post stable, and less informed students are protected from the curse of acceptance. Our results have implications for the current debate over priority design in school choice.

Works in Progress

Signal Jamming and Collusion

An Experimental Study of Payment Scheme Sorting into Markets for Credence Goods (joint with Ellen Green)