Bounded best-response and collective-optimality reasoning in coordination games

B-Tier
Journal: Journal of Economic Behavior and Organization
Year: 2017
Volume: 140
Issue: C
Pages: 317-335

Score contribution per author:

0.670 = (α=2.01 / 3 authors) × 1.0x B-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

We investigate experimentally the conditions under which bounded best-response and collective-optimality reasoning are used in coordination games. Using level-k and team reasoning theories as exemplars, we study games with three pure-strategy equilibria, two of which are mutually isomorphic. The third is always team-optimal, but whether it is predicted by level-k theory differs across games. We find that collective-optimality reasoning is facilitated if the collectively optimal equilibrium gives more equal payoffs than the others, and is inhibited if that equilibrium is Pareto-dominated by the others, considered separately. We suggest that coordination cannot be explained by a single theory.

Technical Details

RePEc Handle
repec:eee:jeborg:v:140:y:2017:i:c:p:317-335
Journal Field
Theory
Author Count
3
Added to Database
2026-01-25