The Determinants of Efficient Behavior in Coordination Games

Pedro Dal Bã³, Guillaume R. Fréchette and Jeongbin Kim
Authors registered in the RePEc Author Service: Pedro Dal Bó

No 2020-17, Working Papers from Brown University, Department of Economics

Abstract: We study the determinants of efficient behavior in stag hunt games (2x2 symmetric coordination games with Pareto ranked equilibria) using both data from eight previous experiments on stag hunt games and data from a new experiment which allows for a more systematic variation of parameters. In line with the previous experimental literature, we find that subjects do not necessarily play the efficient action (stag). While the rate of stag is greater when stag is risk dominant, we find that the equilibrium selection criterion of risk dominance is neither a necessary nor sufficient condition for a majority of subjects to choose the efficient action. We do find that an increase in the size of the basin of attraction of stag results in an increase in efficient behavior. We show that the results are robust to controlling for risk preferences.

Date: 2020
New Economics Papers: this item is included in nep-exp and nep-gth
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Journal Article: The determinants of efficient behavior in coordination games (2021)
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