An experimental evaluation of regret-based econometrics

Noam Nisan, Gali Noti

Research output: Chapter in Book/Report/Conference proceedingConference contributionpeer-review

6 Scopus citations

Abstract

Using data obtained in a controlled ad-auction experiment that we ran, we evaluate the regret-based approach to econometrics that was recently suggested by Nekipelov, Syrgkanis, and Tardos (EC 2015). We found that despite the weak regret-based assumptions, the results were (at least) as accurate as those obtained using classic equilibrium-based assumptions. En route we studied to what extent humans actually minimize regret in our ad auction, and found a significant difference between the “high types” (players with a high valuation) who indeed rationally minimized regret and the “low types” who significantly overbid. We suggest that correcting for these biases and adjusting the regret-based econometric method may improve the accuracy of estimated values.

Original languageAmerican English
Title of host publication26th International World Wide Web Conference, WWW 2017
PublisherInternational World Wide Web Conferences Steering Committee
Pages73-81
Number of pages9
ISBN (Print)9781450349130
DOIs
StatePublished - 2017
Event26th International World Wide Web Conference, WWW 2017 - Perth, Australia
Duration: 3 Apr 20177 Apr 2017

Publication series

Name26th International World Wide Web Conference, WWW 2017

Conference

Conference26th International World Wide Web Conference, WWW 2017
Country/TerritoryAustralia
CityPerth
Period3/04/177/04/17

Bibliographical note

Publisher Copyright:
© 2017 International World Wide Web Conference Committee (IW3C2).

Keywords

  • Behavioral economics
  • Cognitive biases
  • Econometrics
  • Regret
  • Sponsored search auctions

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