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Are Two Heads Better Than One? Team versus Individual Play in Signaling Games

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  • David J. Cooper
  • John H. Kagel

Abstract

We compare individuals with two-person teams in signaling game experiments. Teams consistently play more strategically than individuals and generate positive synergies in more difficult games, beating a demanding "truth-wins" norm. The superior performance of teams is most striking following changes in payoffs that change the equilibrium outcome. Individuals play less strategically following the change in payoffs than inexperienced subjects playing the same game. In contrast, the teams exhibit positive learning transfer, playing more strategically following the change than inexperienced subjects. Dialogues between teammates are used to identify factors promoting strategic play.

Suggested Citation

  • David J. Cooper & John H. Kagel, 2005. "Are Two Heads Better Than One? Team versus Individual Play in Signaling Games," American Economic Review, American Economic Association, vol. 95(3), pages 477-509, June.
  • Handle: RePEc:aea:aecrev:v:95:y:2005:i:3:p:477-509
    Note: DOI: 10.1257/0002828054201431
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    References listed on IDEAS

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