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Real time tacit bargaining, payoff focality, and coordination complexity: Experimental evidence

Author

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  • Wolfgang Luhan

    (Ruhr University Bochum)

  • Anders Poulsen

    (University of East Anglia)

  • Michael Roos

    (Ruhr University Bochum)

Abstract

We report experimental data from a bargaining situation where two decision makers tacitly make their decisions, and earn and cumulate their payoffs in real time. Examples include fishermen choosing fishing spots, interaction among neighbors who prefer not to talk, military conflict, and tacit duopoly. The data can be organized and explained in terms of focal properties of feasible payoffs, and the complexity of coordinating on the intertemporal behavior required to achieve these payoffs. Bargainers trade off payoff focality and coordination complexity, and behavior can be systematically inefficient.

Suggested Citation

  • Wolfgang Luhan & Anders Poulsen & Michael Roos, 2015. "Real time tacit bargaining, payoff focality, and coordination complexity: Experimental evidence," Working Paper series, University of East Anglia, Centre for Behavioural and Experimental Social Science (CBESS) 15-11, School of Economics, University of East Anglia, Norwich, UK..
    • Handle: RePEc:uea:wcbess:15-11
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    More about this item

    Keywords

    bargaining; real time interaction; payoff focality; coordination complexity; bounded rationality;
    All these keywords.

    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
    • C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior

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