 Tournaments as coordination devices: Theory and experimental evidenceZhiqiang Dong and Yanren Zhang Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), 2022, vol. 100, issue C Abstract: Thomas C. Schelling proposed that individuals can coordinate more successfully than conventional models of coordination predict if they use payoff-irrelevant features to label strategies. However, recent experimental evidence illustrates that salient labels may lose much of their effectiveness when the payoffs are asymmetric. In this paper, we consider an asymmetric coordination game with two inequity-averse players. The model features a preplay tournament in which the two players compete to justify their future dominance. We argue that, after observing the result of the tournament, both players are more willing to select the label-salient strategy because the inequality in equilibrium is justified by the performance gap in the tournament. To test this prediction, we design an experiment that allows us to adjust the justifiability of inequality. The experimental results demonstrate that a preplay tournament may constitute an effective focal point that increases the likelihood of coordination. JEL-codes: D23 D73 D91 M51 M54 (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:soceco:v:100:y:2022:i:c:s2214804322000969 DOI: 10.1016/j.socec.2022.101924 Access Statistics for this article Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics) is currently edited by Pablo Brañas Garza More articles in Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics) from Elsevier |
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