Very interesting Game Theory article

[AaronBrown]

You're right that a reasonable person will say $100. A sneak might say $99 and a few people might say $98. But no reasonable person will say less than that, unless they pick the correct price out of honesty, or misunderstand the game.

The problem is it's hard to come up with a mathematical argument for that result, without using ad hoc assumptions or saying people do irrational things. Therefore some people question the value of game theory in general, other people suggest various fixes and get in impassioned arguments about why their fix is natural and everyone else's is silly, and others say the mathematics works and people don't.

I'm in the middle group, except I'm willing to entertain a variety of ideas. I think Bachrach has it right, but I could be wrong.