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The dark side of friendship: envy

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Author Info
Ramón Cobo-Reyes () (Department of Economic Theory and Economic History, University of Granada.)
Natalia Jiménez () (Department of Economic Theory and Economic History, University of Granada.)

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Abstract

This paper studies the e¤ect of social relations on the convergence to the e¢ cient equilibrium in a 2x2 coordination game. We employ a 2x2 factorial design in which we explore two di¤erent games with asymmetric payo¤s and two matching protocols: .friends.versus .strangers.. In the .rst game payo¤s of the worse o¤ player are the same in the two equilibria, whereas in the second game, this player must sacri.ce her own payo¤ for achieving the e¢ cient equilibrium. Results show that .strangers. coor- dinate more frequently in the e¢ cient equilibrium than .friends.in both games. Regarding network measures, (such us degree in, degree out and betweenness) they are all positively correlated with the strategy which leads to the e¢ cient outcome except clustering. In addition, envy is a salient factor in explaining e¢ cient convergence.

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Publisher Info
Paper provided by Department of Economic Theory and Economic History of the University of Granada. in its series ThE Papers with number 07/07.

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Length: 39 pages
Date of creation: 31 Dec 2007
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Handle: RePEc:gra:wpaper:07/07

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Related research
Keywords: coordination; efficiency; envy; experiments; friendship; social networks.;

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Find related papers by JEL classification:
A14 - General Economics and Teaching - - General Economics - - - Sociology of Economics
C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior
D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement

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    Other versions:
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  14. Pablo Brañas-Garza & Ramón Cobo-Reyes & Almudena Domínguez, 2005. ""Si él lo necesita": Gypsy fairness in Vallecas," ThE Papers 05/02, Department of Economic Theory and Economic History of the University of Granada.. [Downloadable!]
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