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When and Why? A Critical Survey on Coordination Failure in the Laboratory

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  • Giovanna Devetag
  • Andreas Ortmann

Abstract

Coordination games with Pareto-ranked equilibria have attracted major theoretical attention over the past two decades. Two early path-breaking sets of experimental studies were widely interpreted as suggesting that coordination failure is a common phenomenon in the laboratory. We identify the major determinants that seem to affect the incidence, and/or emergence, of coordination failure in the lab and review critically the existing experimental studies on coordination games with Pareto-ranked equilibria since that early evidence emerged. We conclude that coordination failure is likely to be the exception rather than the rule, both in the lab and outside of it.

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Paper provided by The Center for Economic Research and Graduate Education - Economic Institute, Prague in its series CERGE-EI Working Papers with number wp302.

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Date of creation: Sep 2006
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Handle: RePEc:cer:papers:wp302

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Keywords: Coordination games; Pareto-ranked equilibria; Payoff-asymmetric equilibria; Stag-hunt games; Optimization incentives; Robustness; Coordination; Coordination failure;

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