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Waiting To Cooperate?

Author Info

Listed author(s):
  • Todd R. Kaplan

    ()

    (University of Exeter, University of Haifa)

  • Bradley J. Ruffle

    ()

    (Wilfrid Laurier University, Ben-Gurion University)

  • Ze’ev Shtudiner

    ()

    (Ariel University)

Abstract

Sometimes cooperation between two parties requires exactly one to cede to the other. If the decisions whether to cede are made simultaneously, then neither or both may acquiesce leading to an inefficient outcome. However, inefficiency may be avoided if a party can wait to see what the other does. We experimentally test whether adding a waiting option to such a two-player cooperation game enhances cooperation. Although subjects cede less overall with the waiting option, we show that they coordinate more and consequently achieve higher profits. Yet, a dark side overhangs waiting: the least cooperative pairs do worse with this option. They wait not to facilitate coordination but to disguise their entry.

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File URL: http://in.bgu.ac.il/en/humsos/Econ/Workingpapers/1314.pdf
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Paper provided by Ben-Gurion University of the Negev, Department of Economics in its series Working Papers with number 1314.

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Length: 27 pages
Date of creation: 2013
Handle: RePEc:bgu:wpaper:1314
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Find related papers by JEL classification:
  • C9 - Mathematical and Quantitative Methods - - Design of Experiments
  • Z13 - Other Special Topics - - Cultural Economics - - - Economic Sociology; Economic Anthropology; Language; Social and Economic Stratification

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  1. Potters, Jan & Sefton, Martin & Vesterlund, Lise, 2005. "After you--endogenous sequencing in voluntary contribution games," Journal of Public Economics, Elsevier, vol. 89(8), pages 1399-1419, August.
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  6. Timothy Cason & Sau-Him Lau & Vai-Lam Mui, 2013. "Learning, teaching, and turn taking in the repeated assignment game," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 54(2), pages 335-357, October.
  7. Huck, Steffen & Muller, Wieland & Normann, Hans-Theo, 2001. "Stackelberg Beats Cournot: On Collusion and Efficiency in Experimental Markets," Economic Journal, Royal Economic Society, vol. 111(474), pages 749-765, October.
  8. Todd R. Kaplan & Bradley J. Ruffle, 2012. "Which Way to Cooperate," Economic Journal, Royal Economic Society, vol. 122(563), pages 1042-1068, 09.
  9. Anthony Ziegelmeyer & Kene Boun My & Jean-Christophe Vergnaud & Marc Willinger, 2006. "Strategic Delay and Rational Imitation in the Laboratory," Papers on Strategic Interaction 2005-35, Max Planck Institute of Economics, Strategic Interaction Group.
  10. MiguelA. Fonseca & Hans-Theo Normann, 2008. "Mergers, Asymmetries and Collusion: Experimental Evidence," Economic Journal, Royal Economic Society, vol. 118(527), pages 387-400, 03.
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