Learning and equilibrium as useful approximations

de Ido Erev

There is a good deal of miscommunication between and among experimenters and theorists, and psychologists and economists, about how to evaluate a theory that can be rejected by sufficient data, but may nevertheless be a useful approximation. A standard experimental design reports whether a general theory can be rejected on an informative test case. This paper, in contrast, reports an experiment designed to meaningfully pose the question: "how good an approximation does a theory provide on average."