Narrow Results

The level-$k$ model is a workhorse in behavioral game theory. For comparisons across experiments and predictions in future studies, it is crucial to assess the empirical distribution of $k$-levels. We present a revelation game suitable for this purpose. In a labor market context, workers can choose to reveal their productivity at a cost, and players’ strategies reveal their level of reasoning in terms of a $k$-level. We find that the most frequently observed reasoning levels are $k=2$ and $k=3$. In our game roughly 30% of the players are $k\le 1$ and 25% are $k\ge 4$. We compare our results to other experiments that identify level-$k$ distribution, foremost to the money request (or 11–20) game. Despite various differences to the 11–20 game, our revelation game suggests a very similar distribution of level-$k$ types.