We test in the laboratory the potential of evolutionary dynamics as predictor of actual behavior. To this end we propose an asymmetric game which we interpret as a borrower lender relation, study its evolutionary dynamics in a random matching set-up, and test its predictions. The theoretical model provides conditions for changes in qualitative aggregate behavior in response to variations in structural parameters. While it turns out that Nash equilibrium is not reliable predictor of average aggregate behavior, the experiment seems to confirm the qualitative predictions of the theoretical model under structural changes.

JEL Classifications C7, C9, E3

Keywords: Cycles, Evolutionary Dynamics, Games, Experiments

Co-author Maria Saez Marti