The focality of dominated compromises in tacit coordination situations: Experimental evidence

Zoë Bett (Lead Author), Anders Poulsen, Odile Poulsen

Research output: Contribution to journalArticle

5 Citations (Scopus)
10 Downloads (Pure)

Abstract

We experimentally investigate if subjects in a tacit coordination situation with a conflict of interest tend to choose an equal compromise, even if it is strictly dominated. The data show that this is the case, as long as the compromise payoffs are not too low. Game comparisons suggest that choosing a dominated compromise is a focal point that allows subjects to avoid a costly coordination failure.
Original languageEnglish
Pages (from-to)29-34
Number of pages6
JournalJournal of Behavioral and Experimental Economics
Volume60
Early online date21 Dec 2015
DOIs
Publication statusPublished - Feb 2016

Keywords

  • Coordination
  • equality
  • efficiency
  • focal point
  • level-k model
  • inequity aversion

Cite this