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Overcoming coordination failure in games with focal points: An experimental investigation

David Rojo-Arjona, R. Stefania Sitzia and Jiwei Zheng
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David Rojo-Arjona: The George L Argyros School of Business and Economics, Chapman University.
R. Stefania Sitzia: School of Economics and Centre for Behavioural and Experimental Social Science, University of East Angle, Norwich.
Jiwei Zheng: School of Economics and Centre for Behavioural and Experimental Social Science, University of East Anglia, Norwich

Authors registered in the RePEc Author Service: David Rojo Arjona ()

No 21-02, Working Paper series, University of East Anglia, Centre for Behavioural and Experimental Social Science (CBESS) from School of Economics, University of East Anglia, Norwich, UK.

Abstract: Focal points (Schelling, 1960) have shown limitations as coordination devices in games with conflict, such as the battle of the sexes games. We experimentally test whether an increase in their salience can counteract the negative impact of conflict on coordination. The intuition is that, in the presence of conflict, the solution to the coordination dilemma offered by the focal point loses importance. Increasing its salience increases its relevance and therefore coordination success. Our results provide strong support for this conjecture. Furthermore, when games feature outcomes with different degrees of payoffs’ inequality (i.e. the difference of players’ payoffs) and efficiency (i.e. the sum of players’ payoffs), increasing salience does not lead to an obvious increase in coordination, unless the salience of the focal point is maximal.

Keywords: coordination games; focal points; salience; conflict of interests; battle-of-thesexes; intermixed-blocked effect. (search for similar items in EconPapers)
JEL-codes: C72 C78 C91 D91 (search for similar items in EconPapers)
Date: 2021-08
New Economics Papers: this item is included in nep-cbe, nep-exp, nep-gth, nep-isf and nep-mic
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