| Summary: | We propose that in
strategic interactions a player is influenced by self-similarity.
Self-similarity means that a player who chooses some action X tends to believe,
to a greater extent than a player who chooses a different action, that other
players will also choose action X. To demonstrate this phenomenon, we analyze
the actions and the reported beliefs of players in a two-player two-action
symmetric game. The game has the feature that for "materialistic" players, who
wish to maximize their own payoff, there should be negative correlation between
players' actions and the beliefs that they assign to their opponent choosing
the same action. We first elicit participants' preferences over the outcomes of
the game, and identify a large group of materialistic players. We then ask
participants to choose an action in the game and report their beliefs. The
reported beliefs of materialistic players are positively correlated with their
actions, i.e., they are more likely to choose an action the stronger is their
belief that their opponent will also choose the same action. We view this
pattern as evidence for the presence of self-similarity.
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