Communication in Coordination Games

Russell Cooper, Douglas V. DeJong, Robert Forsythe, Thomas W. Ross

Research output: Chapter in Book/Report/Conference proceedingChapter

Abstract

We present experimental evidence on nonbinding, preplay communication in bilateral coordination games. To evaluate the effect of "cheap talk," we consider two communication structures (one-way and two-way communication) and two types of coordination games (one with a cooperative strategy and a second in which one strategy is less "risky"). In games with a cooperative strategy, one-way communication increases play of the Pareto-dominant equilibrium relative to the no communication baseline; two-way communication does not always decrease the frequency of coordination failures. In the second type of game, two-way communication always leads to the Pareto-dominant Nash equilibrium, while one-way communication does not.

Original languageEnglish (US)
Title of host publicationExperiments in Environmental Economics
PublisherTaylor and Francis Inc.
Pages345-378
Number of pages34
Volume1
ISBN (Electronic)9781315196350
ISBN (Print)9781138717398
StatePublished - Apr 27 2018

All Science Journal Classification (ASJC) codes

  • Social Sciences(all)

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