TY  - RPRT
        AU  - Gill, David
AU  - Rosokha, Yaroslav
        TI  - Identifying Level-k Reasoning in Repeated Games: Strategies, Beliefs, and Cognitive Ability
        PY  - 2026/Jul/
        PB  - Institute of Labor Economics (IZA)
        CY  - Bonn
        T2  - IZA Discussion Paper
        IS  - 18832
        UR  - https://www.iza.org/index.php/publications/dp18832
        AB  - In this paper, we identify level-k reasoning in repeated games that operates at the level of a supergame strategy. First, we develop a model of level-k reasoning that incorporates choices over strategies as well as beliefs about the strategies chosen by others. Then, jointly using elicited strategies and beliefs about strategies from the indefinitely repeated Prisoner's Dilemma, and applying a new notion of balance-optimal error tolerance, we classify a substantial fraction of subjects as level-1 or level-2. Moreover, we show that when level-k reasoning operates at the level of a repeated-game strategy, cognitive ability and experience predict higher level reasoning.
        KW  - level-k
KW  - repeated game
KW  - Prisoner's Dilemma
KW  - strategy
KW  - beliefs
KW  - cognitive ability
KW  - experience
KW  - elicitation
KW  - bounded rationality
KW  - experiment
KW  - game theory
        ER  -