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You better play 7: mutual versus common knowledge of advice in a weak-link experiment

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  • Devetag, Giovanna
  • Hosni, Hykel
  • Sillari, Giacomo

Abstract

This paper presents the results of an experiment on mutual versus common knowledge of advice in a two-player weak-link game with random matching. Our experimental subjects play in pairs for thirteen rounds. After a brief learning phase common to all treatments, we vary the knowledge levels associated with external advice given in the form of a suggestion to pick the strategy supporting the payoff- dominant equilibrium. Our results are somewhat surprising and can be summarized as follows: in all our treatments both the choice of the efficiency-inducing action and the percentage of efficient equilibrium play are higher with respect to the control treatment, revealing that even a condition as weak as mutual knowledge of level 1 is sufficient to significantly increase the salience of the efficient equilibrium with respect to the absence of advice. Furthermore, and contrary to our hypothesis, mutual knowledge of level 2 induces, under suitable conditions, successful coordination more frequently than common knowledge.

Suggested Citation

  • Devetag, Giovanna & Hosni, Hykel & Sillari, Giacomo, 2013. "You better play 7: mutual versus common knowledge of advice in a weak-link experiment," LSE Research Online Documents on Economics 47260, London School of Economics and Political Science, LSE Library.
  • Handle: RePEc:ehl:lserod:47260
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    2. Siebert, Jan & Yang, Guanzhong, 2017. "Discoordination and miscoordination caused by sunspots in the laboratory," Working Papers on East Asian Studies 114/2017, University of Duisburg-Essen, Institute of East Asian Studies IN-EAST.

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    More about this item

    Keywords

    coordination games; experimental philosophy; epistemic attitudes; weak-link game; conventions;
    All these keywords.

    JEL classification:

    • D01 - Microeconomics - - General - - - Microeconomic Behavior: Underlying Principles
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness

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