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Cognitive Forward Induction and Coordination without Common Knowledge: An Experimental Study

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  • Andreas Blume
  • Uri Gneezy

Abstract

This paper investigates optimal play in coordination games in which cognition plays an important role. In our game logically omniscient players would be able to identify a distinct coordination opportunity from other obvious facts. Real players may be unable to make the required inference. Our main experimental results are that in a coordination task with a cognitive component (1) players play differently when playing against themselves rather than against another player, and (2) given the opportunity, players signal cognition by choosing the coordination task over an outside option, a phenomenon which we refer to as cognitive forward induction.

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Bibliographic Info

Paper provided by University of Pittsburgh, Department of Economics in its series Working Papers with number 346.

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Date of creation: Apr 2009
Date of revision: May 2009
Handle: RePEc:pit:wpaper:346

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Citations

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Cited by:
  1. Martin Dufwenberg & Gunnar Köhlin & Peter Martinsson & Haileselassie Medhin, 2014. "Thanks but No Thanks: A New Policy to Reduce Land Conflict," Working Papers 519, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University.
  2. Andreas Blume & John Duffy & April Mitchell Franco, 2008. "Decentralized Organizational Learning: An Experimental Investigation," Working Papers 382, University of Pittsburgh, Department of Economics, revised May 2009.
  3. Kristóf Madarász & Uri Gneezy & Alex Imas, 2012. "Conscience accounting: emotional dynamics and social behaviour," LSE Research Online Documents on Economics 47994, London School of Economics and Political Science, LSE Library.
  4. Antoni Bosch-Dom�nech & Nicolaas J. Vriend, 2008. "On the Role of Non-equilibrium Focal Points as Coordination Devices," Working Papers 621, Queen Mary, University of London, School of Economics and Finance.
  5. Feinberg, Yossi, 2005. "Games with Incomplete Awareness," Research Papers 1894, Stanford University, Graduate School of Business.
  6. Blume, A. & DeJong, D.V. & Maier, M., 2005. "Cognition in Spatial Dispersion Games," Discussion Paper 2005-58, Tilburg University, Center for Economic Research.
  7. Carlos Alós-Ferrer & Christoph Kuzmics, 2008. "Hidden Symmetries and Focal Points," TWI Research Paper Series 35, Thurgauer Wirtschaftsinstitut, Universität Konstanz.
  8. Blume, A. & DeJong, D.V. & Maier, M., 2005. "Learning Strategic Sophistication," Discussion Paper 2005-59, Tilburg University, Center for Economic Research.
  9. Andreas Blume & April Franco, 2002. "Learning from failure," Staff Report 299, Federal Reserve Bank of Minneapolis.
  10. Andonie, Costel & Kuzmics, Christoph, 2012. "Pre-election polls as strategic coordination devices," Journal of Economic Behavior & Organization, Elsevier, vol. 84(2), pages 681-700.
  11. Uri Gneezy & Alex Imas & Kristóf Madarász, 2012. "Conscience Accounting: Emotional Dynamics and Social Behavior," STICERD - Theoretical Economics Paper Series /2012/563, Suntory and Toyota International Centres for Economics and Related Disciplines, LSE.

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