A Quantum Treatment of Public Goods Economics

Quantum generalizations of conventional games broaden the range of available strategies, which can help improve outcomes for the participants. With many players, such quantum games can involve entanglement among many states which is difficult to implement, especially if the states must be communicated over some distance. This paper describes a quantum approach to the economically significant n-player public goods game that requires only two-particle entanglement and is thus much easier to implement than more general quantum mechanisms. In spite of the large temptation to free ride on the efforts of others in the original game, two-particle entanglement is sufficient to give near optimal expected payoff when players use a simple mixed strategy for which no player can benefit by making different choices. This mechanism can also address some heterogeneous preferences among the players. PACS: 03.67-a; 02.50Le; 89.65.Gh     

Predicting the Future

We present a novel methodology for predicting future outcomes that uses small numbers of individuals participating in an imperfect information market. By determining their risk attitudes and performing a nonlinear aggregation of their predictions, we are able to assess the probability of the future outcome of an uncertain event and compare it to both the objective probability of its occurrence and the performance of the market as a whole. Experiments show that this nonlinear aggregation mechanism vastly outperforms both the imperfect market and the best of the participants. We then extend the mechanism to prove robust in the presence of public information.     

How Well Do People Play a Quantum Prisoner’s Dilemma?

Game theory suggests quantum information processing technologies could provide useful new economic mechanisms. For example, using shared entangled quantum states can alter incentives so as to reduce the free-rider problem inherent in economic contexts such as public goods provisioning. However, game theory assumes players understand fully the consequences of manipulating quantum states and are rational. Its predictions do not always describe human behavior accurately. To evaluate the potential practicality of quantum economic mechanisms, we experimentally tested how people play the quantum version of the prisoner’s dilemma game in a laboratory setting using a simulated version of the underlying quantum physics. Even without formal training in quantum mechanics, people nearly achieve the payoffs theory predicts, but do not use mixed-strategy Nash equilibria predicted by game theory. Moreover, this correspondence with game theory for the quantum game is closer than that of the classical game.     

Experiments with probabilistic quantum auctions

We describe human-subject laboratory experiments on probabilistic auctions based on previously proposed auction protocols involving the simulated manipulation and communication of quantum states. These auctions are probabilistic in determining which bidder wins, or having no winner, rather than always having the highest bidder win. Comparing two quantum protocols in the context of first-price sealed bid auctions, we find the one predicted to be superior by game theory also performs better experimentally. We also compare with a conventional first-price auction, which gives higher performance. Thus to provide benefits, the quantum protocol requires more complex economic scenarios such as maintaining privacy of bids over a series of related auctions or involving allocative externalities.      

Working on the basis of collective and lease contracts

Vocational-Economic Training

Working on the basis of collective and lease contracts