Dynamic coordination via organizational routines
AbstractWe investigate dynamic coordination among members of a problem-solving team who receive private signals about which of their actions are required for a (static) coordinated solution and who have repeated opportunities to explore different action combinations. In this environment ordinal equilibria, in which agents condition only on how their signals rank their actions and not on signal strength, lead to simple patterns of behavior that have a natural interpretation as routines. These routines partially solve the team's coordination problem by synchronizing the team's search efforts and prove to be resilient to changes in the environment by being ex post equilibria, to agents having only a coarse understanding of other agents' strategies by being fully cursed, and to natural forms of agents' overconfidence. The price of this resilience is that optimal routines are frequently suboptimal equilibria.
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Bibliographic InfoPaper provided by ESMT European School of Management and Technology in its series ESMT Research Working Papers with number ESMT-11-10.
Length: 58 pages
Date of creation: 06 Sep 2011
Date of revision:
coordination games; organizational routines; decentralized information; ex-post equilibria; cursed equilibria; multi-agent learning; rational learning;
Other versions of this item:
- Blume, Andreas & Franco, April Mitchell & Heidhues, Paul, 2011. "Dynamic Coordination via Organizational Routines," Discussion Paper Series of SFB/TR 15 Governance and the Efficiency of Economic Systems 355, Free University of Berlin, Humboldt University of Berlin, University of Bonn, University of Mannheim, University of Munich.
- Andreas Blume, 2011. "Dynamic Coordination Via Organizational Routines," Working Papers 439, University of Pittsburgh, Department of Economics, revised Jan 2011.
- C73 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Stochastic and Dynamic Games; Evolutionary Games
- D23 - Microeconomics - - Production and Organizations - - - Organizational Behavior; Transaction Costs; Property Rights
This paper has been announced in the following NEP Reports:
- NEP-ALL-2011-09-16 (All new papers)
- NEP-CBE-2011-09-16 (Cognitive & Behavioural Economics)
- NEP-CTA-2011-09-16 (Contract Theory & Applications)
- NEP-GTH-2011-09-16 (Game Theory)
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