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In periods 1-5 of this experiment you played a game where at the start of each period a $10 endowment was given to the first
In periods 1-5 of this experiment you played a game where at the start of each period a $10 endowment was given to the first mover. The first mover had to decide how much of this $10 to keep for themselves and how much to pass to the second mover. Any money that was passed the second mover was then multiplied by a factor of 6. After this happened, the second mover could return any portion of this multiplied amount back to the first mover and the second mover would keep any money that they decided to not pass back. Finally, playing partners changed randomly at the start of each new period. That is, a one-shot matching method was used in periods 1-5. Assume that both the first mover and the second mover are self-interested. That is, each player seeks to maximize their earnings in this game. If we assume this, how much of the $10 endowment should the first mover pass to the second mover? Since this is a sequential-move game, we must work backwards to figure out the answer. First, assume that the first mover passes some of the $10 endowment to the second mover, which is then
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