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Ignorance Is Bliss: An Experimental Study of the Use of Ambiguity and Vagueness in the Coordination Games with Asymmetric Payoffs

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  • Marina Agranov
  • Andrew Schotter

Abstract

We consider a game where one player, the Announcer, has to communicate the value of a payoff relevant state of the world to a set of players who play a coordination game with multiple equilibria. While the Announcer and the players agree that coordination is desirable, since the payoffs of the players at the equilibria are unequal, they disagree as to which equilibrium is best. We demonstrate experimentally that in such coordination games, in order to mask the asymmetry of equilibrium payoffs, it may be advantageous for a utilitarian benevolent Announcer to communicate in an ambiguous or vague manner. (JEL C71, D81, D83)

Suggested Citation

  • Marina Agranov & Andrew Schotter, 2012. "Ignorance Is Bliss: An Experimental Study of the Use of Ambiguity and Vagueness in the Coordination Games with Asymmetric Payoffs," American Economic Journal: Microeconomics, American Economic Association, vol. 4(2), pages 77-103, May.
    • Handle: RePEc:aea:aejmic:v:4:y:2012:i:2:p:77-103
    Note: DOI: 10.1257/mic.4.2.77
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    Citations

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    Cited by:

    1. Keh-Kuan Sun & Stella Papadokonstantaki, 2023. "Lying Aversion and Vague Communication: An Experimental Study," Papers 2301.00372, arXiv.org, revised Sep 2023.
    2. Ennio Bilancini & Leonardo Boncinelli & Luigi Luini, 2017. "Does Focality Depend on the Mode of Cognition? Experimental Evidence on Pure Coordination Games," Department of Economics University of Siena 771, Department of Economics, University of Siena.
    3. Adrian de Groot Ruiz & Theo Offerman & Sander Onderstal, 2011. "Equilibrium Selection in Cheap Talk Games: ACDC rocks when Other Criteria remain silent," Tinbergen Institute Discussion Papers 11-037/1, Tinbergen Institute, revised 31 Oct 2011.
    4. Daniel H. Wood, 2022. "Communication-Enhancing Vagueness," Games, MDPI, vol. 13(4), pages 1-27, June.
    5. Leland, Jonathan W. & Schneider, Mark, 2018. "A theory of focal points in 2 × 2 games," Journal of Economic Psychology, Elsevier, vol. 65(C), pages 75-89.
    6. Ginger Zhe Jin & Michael Luca & Daniel Martin, 2021. "Is No News (Perceived As) Bad News? An Experimental Investigation of Information Disclosure," American Economic Journal: Microeconomics, American Economic Association, vol. 13(2), pages 141-173, May.
    7. Siyu Wang & Timothy Flannery, 2021. "Intention or Request: The Impact of Message Structures," Games, MDPI, vol. 12(1), pages 1-13, February.
    8. Agranov, Marina & Schotter, Andrew, 2013. "Language and government coordination: An experimental study of communication in the announcement game," Journal of Public Economics, Elsevier, vol. 104(C), pages 26-39.
    9. Lang, Matthias & Schudy, Simeon, 2023. "(Dis)honesty and the value of transparency for campaign promises," European Economic Review, Elsevier, vol. 159(C).
    10. Antinyan, Armenak & Corazzini, Luca & D'Agostino, Elena & Pavesi, Filippo, 2023. "Watch your words: An experimental study on communication and the opportunity cost of delegation," Journal of Economic Behavior & Organization, Elsevier, vol. 214(C), pages 216-232.
    11. Adrian Groot Ruiz & Theo Offerman & Sander Onderstal, 2014. "For those about to talk we salute you: an experimental study of credible deviations and ACDC," Experimental Economics, Springer;Economic Science Association, vol. 17(2), pages 173-199, June.
    12. Adrian de Groot Ruiz & Theo Offerman & Sander Onderstal, 2011. "An Experimental Study of Credible Deviations and ACDC," Tinbergen Institute Discussion Papers 11-153/1, Tinbergen Institute.
    13. Marvin Deversi & Alessandro Ispano & Peter Schwardmann, 2018. "Spin Doctors: A Model and an Experimental Investigation of Vague Disclosure," CESifo Working Paper Series 7244, CESifo.
    14. Zhang, Qiaoxi, 2020. "Vagueness in multidimensional proposals," Games and Economic Behavior, Elsevier, vol. 121(C), pages 307-328.
    15. de Groot Ruiz, Adrian & Offerman, Theo & Onderstal, Sander, 2015. "Equilibrium selection in experimental cheap talk games," Games and Economic Behavior, Elsevier, vol. 91(C), pages 14-25.
    16. Khalmetski, Kiryl & Rockenbach, Bettina & Werner, Peter, 2017. "Evasive lying in strategic communication," Journal of Public Economics, Elsevier, vol. 156(C), pages 59-72.
    17. Xinyu Li & Ronald Peeters, 2016. "Cheap Talk with Multiple Strategically Interacting Audiences: An Experimental Study," PLOS ONE, Public Library of Science, vol. 11(10), pages 1-14, October.
    18. Kellner, Christian & Le Quement, Mark T. & Riener, Gerhard, 2022. "Reacting to ambiguous messages: An experimental analysis," Games and Economic Behavior, Elsevier, vol. 136(C), pages 360-378.
    19. Isoni, Andrea & Poulsen, Anders & Sugden, Robert & Tsutsui, Kei, 2019. "Focal points and payoff information in tacit bargaining," Games and Economic Behavior, Elsevier, vol. 114(C), pages 193-214.
    20. Meub, Lukas & Proeger, Till & Bizer, Kilian & Spiwoks, Markus, 2015. "Strategic coordination in forecasting – An experimental study," Finance Research Letters, Elsevier, vol. 13(C), pages 155-162.
    21. Buyukboyaci, Muruvvet & Kucuksenel, Serkan, 2016. "Coordination and Cheap Talk: Indirect versus Direct Messages," MPRA Paper 68964, University Library of Munich, Germany.
    22. Cabrales, Antonio & Drouvelis, Michalis & Gurguc, Zeynep & Ray, Indrajit, 2018. "Do we need to listen to all stakeholders?: communicating in a coordination game with private information," Cardiff Economics Working Papers E2018/23, Cardiff University, Cardiff Business School, Economics Section.
    23. Bizer, Kilian & Meub, Lukas & Proeger, Till & Spiwoks, Markus, 2014. "Strategic coordination in forecasting: An experimental study," University of Göttingen Working Papers in Economics 195, University of Goettingen, Department of Economics.

    More about this item

    JEL classification:

    • C71 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Cooperative Games
    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness

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