arXiv subjects

Olivier Compte

Publications and source records attributed to Olivier Compte.

4 recordsLinked to original sources

arXiv2025

Learned Collusion

Q-learning can be described as an all-purpose automaton that provides estimates (Q-values) of the continuation values associated with each available action and follows the naive policy of almost always choosing the action with highest Q-value. We consider a family of automata based on Q-values, whose policy may systematically favor some actions over others, for example through a bias that favors cooperation. We look for stable equilibrium biases, easily learned under converging logit/best-response dynamics over biases, not requiring any tacit agreement. These biases strongly foster collusion or cooperation across a rich array of payoff and monitoring structures, independently of initial Q-values.

econ.TH↗

arXiv2025

Endogenous Barriers to Learning

Building on the idea that lack of experience is a source of errors but that experience should reduce them, we model agents' behavior using a stochastic choice model (logit quantal response), leaving endogenous the accuracy of their choices. In some games, higher accuracy leads to unstable logit-response dynamics. Starting from the lowest possible accuracy, we define the barrier to learning as the maximum accuracy which keeps the logit-response dynamic stable (for all lower accuracies). This defines a limit quantal response equilibrium. We apply the concept to centipede, travelers' dilemma, and 11-20 money-request games and to first-price and all-pay auctions, and discuss the role of strategy restrictions in reducing or amplifying barriers to learning.

econ.GN↗

arXiv2023

Consensus and Disagreement: Information Aggregation under (not so) Naive Learning

We explore a model of non-Bayesian information aggregation in networks. Agents non-cooperatively choose among Friedkin-Johnsen type aggregation rules to maximize payoffs. The DeGroot rule is chosen in equilibrium if and only if there is noiseless information transmission, leading to consensus. With noisy transmission, while some disagreement is inevitable, the optimal choice of rule amplifies the disagreement: even with little noise, individuals place substantial weight on their own initial opinion in every period, exacerbating the disagreement. We use this framework to think about equilibrium versus socially efficient choice of rules and its connection to polarization of opinions across groups.

econ.GN↗

arXiv2023

Belief formation and the persistence of biased beliefs

We propose a belief-formation model where agents attempt to discriminate between two theories, and where the asymmetry in strength between confirming and disconfirming evidence tilts beliefs in favor of theories that generate strong (and possibly rare) confirming evidence and weak (and frequent) disconfirming evidence. In our model, limitations on information processing provide incentives to censor weak evidence, with the consequence that for some discrimination problems, evidence may become mostly one-sided, independently of the true underlying theory. Sophisticated agents who know the characteristics of the censored data-generating process are not lured by this accumulation of ``evidence'', but less sophisticated ones end up with biased beliefs.

econ.GN↗