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Coordination through Status

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Author Info
Engseld, Peter () (Department of Economics, Lund University)

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Abstract

The main purpose of this paper is to suggest a mechanism of coordination whereby concerns for high relative position might evolve endogenously. A simple symmetric 2 × 2 strategic coordination game is analyzed in an evolutionary environment where continua of bounded rational agents are randomly matched against each other. The agents are assumed to have the ability to make an imperfect observation on how their own status relates to that of their opponent. These observations are then utilized as an instrument for coordinating the strategies in the game by the conditioning of the pure strategies on whether the opponent has a higher status or a lower status. The outcome of the game is analyzed through a newly defined evolutionary criterion as the agent's observational skills come close to the limit of being perfect. It is shown that there exists an endogenous asymmetry in the model that results in just one of the conditioned strategies in the pure strategy set being evolutionary stable. Moreover, it is also shown that this strategy will prevail against strategies conditioned through other personal characteristics, e.g. size, and gender.

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Publisher Info
Paper provided by Lund University, Department of Economics in its series Working Papers with number 2003:11.

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Length: 60 pages
Date of creation: 14 Jul 2003
Date of revision:
Handle: RePEc:hhs:lunewp:2003_011

Contact details of provider:
Postal: Department of Economics, School of Economics and Management, Lund University, Box 7082, S-220 07 Lund,Sweden
Phone: +46 +46 222 0000
Fax: +46 +46 2224613
Web page: http://www.nek.lu.se/
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Related research
Keywords: Coordination; Hawk-Dove Games; Positional Concerns; Status; Evolutionary Games; Evolutionary Equilibrium;

Find related papers by JEL classification:
C70 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - General
C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

  1. Harold L. Cole & George J. Mailath & Andrew Postlewaite, 1995. "Incorporating concern for relative wealth into economic models," Quarterly Review, Federal Reserve Bank of Minneapolis, issue Sum, pages 12-21. [Downloadable!]
    Other versions:
  2. Frank, Robert H, 1985. "The Demand for Unobservable and Other Nonpositional Goods," American Economic Review, American Economic Association, vol. 75(1), pages 101-16, March. [Downloadable!] (restricted)
  3. Postlewaite, Andrew, 1998. "The social basis of interdependent preferences," European Economic Review, Elsevier, vol. 42(3-5), pages 779-800, May. [Downloadable!] (restricted)
    Other versions:
  4. Weiss, Y. & Fershtman, C., 1997. "Social Status and Economic Performance: A Survey," Papers 19-97, Tel Aviv.
    Other versions:
Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Engseld, Peter, 2005. "Conditioned Actions in Strategic Coordination Games," Working Papers 2005:33, Lund University, Department of Economics. [Downloadable!]
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This page was last updated on 2009-12-2.


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