Resumen de Equilibrium selection, similarity judgments, and the "nothing to gain/nothing to lose" effect

Jonathan W. Leland

• Rubinstein and Leland have both demonstrated that many observed violations of expected and discounted utility can be explained if people employ similarity judgments to make choices. In this paper, I show that this decision process also explains which equilibria will be selected in single-shot games with multiple equilibria and implies that play in games will be associated with anomalies in risky choice. Data supporting these predictions are presented