The prisoner's dilemma and stag hunt games, as well as the apparent benefits of collaboration, have motivated governments to promote more frequent and effective collaboration through a variety of policy approaches. Sometimes, multiple kinds of policies are applied concurrently, and yet little is understood about how these policies might interact with each other. This study uses a simulation approach to examine one such case, when policies focused on increasing collaboration competence interact with those that motivate parties to collaborate based on payoff and non-payoff incentives. Theoretically, our findings suggest seven testable hypotheses for future, rigorous research. Practically, our initial findings suggest that increasing competency generally improves the performance of incentive‐based policies, but not always. Exhortation policies can go too far and may be more prone to doing so when the target population's competency is higher. This means that decision makers are more at risk of applying too much exhortation effort, especially if they are also concurrently applying a competency‐building approach. (C) 2011 by the Association for Public Policy Analysis and Management.