UC Santa Cruz

This dissertation consists of three chapters. Chapter 1, joint with Daniel Friedman, illustrates general techniques for assessing dynamic stability in games of incomplete information by re-analyzing two models of preference evolution. The techniques include extensions of replicator and gradient dynamics, and for both models they confirm local stability of the key static equilibria. Chapter 2 studies strategic default on home mortgages using an experimental approach. I demostrate that (i) people appear to follow the prediction of the strategic default model quite closely in the high asset volatility treatment, and that (ii) incorporating social interactions delays the strategic default beyond what is considered optimal. Finally, Chapter 3, joint with Olga A. Rabanal, shows that introducing assortative matching to one-shot Prisoners' Dilemma type games enhance cooperative behavior.