Efficiency Loss, Coordination, and Agreement Failure in Consensus-Based Systems

Anna Conte, Carlo D'Ippoliti and Jacopo Temperini

No 8b6kf_v1, SocArXiv from Center for Open Science

Abstract: Consensus mechanisms are institutional governance structures that coordinate decentralized agents by aligning incentives to sustain agreement on shared outcomes. Many contemporary designs embed efficiency-reducing contingencies, such as reduced rewards or penalties, intended to discipline behaviour after coordination failure. The implicit assumption is that efficiency loss strengthens incentives to restore agreement. We test this assumption in a controlled agreement environment derived from a consensus-like structure. In a two-stage mechanism where coordination failure reduces available surplus but agreement remains individually rational, laboratory data from 716 participants reveal persistent disagreement in reduced-surplus states. Conflict rates range from approximately 20% to over 60%, contradicting standard equilibrium predictions of universal agreement. These results show that efficiency loss does not necessarily discipline behaviour. Instead, reduced-surplus environments are associated with sustained disagreement and amplified inefficiency, highlighting the importance of incorporating behavioural considerations into the design of consensus-based governance systems.

Date: 2026-03-03
New Economics Papers: this item is included in nep-des, nep-gth and nep-mic
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Persistent link: https://EconPapers.repec.org/RePEc:osf:socarx:8b6kf_v1

DOI: 10.31219/osf.io/8b6kf_v1

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