Constrained Interactions and Social Coordination
AbstractWe consider a co-evolutionary model of social coordination and network formation whereagents may decide on an action in a 2 x 2- coordination game and on whom to establish costly links to. We find that a payoff dominant convention is selected for a wider parameter range when agents may only support a limited number of links as compared to a scenario where agents are not constrained in their linking choice. The main reason behind this result is that constrained interactions create a tradeoff between the interactions an agent has and those he would rather have. Further, we discuss convex linking costs and provide suffcient conditions for the payoff dominant convention to be selected in mxm coordination games.
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Bibliographic InfoPaper provided by University of Vienna, Department of Economics in its series Vienna Economics Papers with number 1004.
Date of creation: Mar 2010
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Other versions of this item:
- Mathias Staudigl & Simon Weidenholzer, 2014. "Constrained Interactions and Social Coordination," Economics Discussion Papers 747, University of Essex, Department of Economics.
- Staudigl, Mathias & Weidenholzer, Simon, 2013. "Constrained Interactions and Social Coordination," Annual Conference 2013 (Duesseldorf): Competition Policy and Regulation in a Global Economic Order 79822, Verein für Socialpolitik / German Economic Association.
- C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
- D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search, Learning, and Information
This paper has been announced in the following NEP Reports:
- NEP-ALL-2010-04-04 (All new papers)
- NEP-EVO-2010-04-04 (Evolutionary Economics)
- NEP-GTH-2010-04-04 (Game Theory)
- NEP-SOC-2010-04-04 (Social Norms & Social Capital)
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