Guessing Game

One individual, the “transmitter, ” had been randomly assigned a true number from 1 to 5, and could elect to reveal or conceal that number to the other individual, the “receiver. ” Then the receiver tried to guess the number as close as possible, using increments of. 5 if they chose to hide it.

Listed here is the catch: Receivers had been compensated additional money dependent on how close they certainly were to your true quantity, while senders were compensated more dependent on exactly how high the receiver guessed. That implied the senders had more motivation to cover up the quantity as soon as the quantity ended up being smaller. That is just what occurred. For number one, senders just unveiled the quantity 5.7 % of that time; for four to five, they revealed the quantity 97.7 per cent of that time period. For figures 2 and 3, meanwhile, senders diverse, reporting the true quantity 40.8 per cent and 88.6 % of that time period, correspondingly.

In which the test gets more interesting, nonetheless, is wanting in the numbers guessed because of the “receivers. ” Even though the average non-reported quantity was 1.584, the common guess ended up being 2.022-meaning that the receivers routinely guessed too much, underestimating the degree to that the “senders” had been hiding bad information. Continue reading