On Smiles, Winks, and Handshakes as Coordination Devices

Paola Manzini (), Abdolkarim Sadrieh () and Nicolaas J. Vriend ()

No 456, Working Papers from Queen Mary, University of London, Department of Economics

Abstract: In an experimental study we examine a variant of the 'minimum effort game', a coordination game with Pareto ranked equilibria, and risk considerations pointing to the least efficient equilibrium. We focus on the question whether simple cues such as smiles, winks and handshakes could be recognized and employed by the players as a tell-tale sign of each other's trustworthiness, thus enabling them to coordinate on the more risky but more rewarding Pareto efficient equilibrium. Our experimental results show that such cues may indeed play a role as coordination devices as their information value is significant and substantial.

Keywords: Coordination games; Pareto efficiency; Trust; Cues; Signals (search for similar items in EconPapers)
JEL-codes: C72 C91 C92 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-exp
Date: 2002-03

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Related works:
Working Paper: On smiles, winks, and handshake as coordination devices (2002)
Journal Article: On Smiles, Winks and Handshakes as Coordination Devices (2009)
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Persistent link: http://EconPapers.repec.org/RePEc:qmw:qmwecw:wp456

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