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Asymmetric and Endogenous Within-Group Communication in Competitive Coordination Games

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  • Timothy N. Cason

    () (Department of Economics, Krannert School of Management, Purdue University)

  • Roman M. Sheremeta

    (Department of Economics, Weatherhead School of Management, Case Western Reserve and Economic Science Institute, Chapman University)

  • Jingjing Zhang

    (Economics Discipline Group, University of Technology Sydney)

Abstract

Within-group communication in competitive coordination games has been shown to increase competition between groups and lower efficiency. This study further explores potentially harmful effects of communication, by addressing the questions of (i) asymmetric communication and (ii) the endogenous emergence of communication. Our theoretical analysis provides testable hypotheses regarding the effect of communication on competitive behavior and efficiency. We test these predictions using a laboratory experiment. The experiment shows that although asymmetric communication is not as harmful as symmetric communication, it leads to more aggressive competition and lower efficiency relative to the case when neither group can communicate. Moreover, groups vote to endogenously open communication channels even though this leads to lower payoffs and efficiency.

Suggested Citation

  • Timothy N. Cason & Roman M. Sheremeta & Jingjing Zhang, 2015. "Asymmetric and Endogenous Within-Group Communication in Competitive Coordination Games," Working Papers 15-23, Chapman University, Economic Science Institute.
  • Handle: RePEc:chu:wpaper:15-23
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    References listed on IDEAS

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    Cited by:

    1. Roman M. Sheremeta, 2016. "The pros and cons of workplace tournaments," IZA World of Labor, Institute for the Study of Labor (IZA), pages 302-302, October.
    2. repec:kap:expeco:v:21:y:2018:i:3:d:10.1007_s10683-018-9573-4 is not listed on IDEAS
    3. Majerczyk, Michael & Sheremeta, Roman & Tian, Yu, 2018. "Adding Tournament to Tournament: Combining Between-Team and Within-Team Incentives," MPRA Paper 86280, University Library of Munich, Germany.
    4. Fu, Qiang & Ke, Changxia & Tan, Fangfang, 2015. "“Success breeds success” or “Pride goes before a fall”?," Games and Economic Behavior, Elsevier, vol. 94(C), pages 57-79.
    5. Francesco Fallucchi & Enrique Fatas & Felix Koelle & Ori Weisel, 2018. "Not all Group Members are created Equal: Heterogeneous Abilities in Inter-group Contests," Discussion Papers 2018-06, The Centre for Decision Research and Experimental Economics, School of Economics, University of Nottingham.
    6. Kurschilgen, Michael & Morell, Alexander & Weisel, Ori, 2017. "Internal conflict, market uniformity, and transparency in price competition between teams," Annual Conference 2017 (Vienna): Alternative Structures for Money and Banking 168057, Verein für Socialpolitik / German Economic Association.
    7. Roman M. Sheremeta, 2016. "Impulsive Behavior in Competition: Testing Theories of Overbidding in Rent-Seeking Contests," Working Papers 16-21, Chapman University, Economic Science Institute.
    8. Roman M. Sheremeta & William A. Masters & Timothy N. Cason, 2012. "Winner-Take-All and Proportional-Prize Contests: Theory and Experimental Results," Working Papers 12-04, Chapman University, Economic Science Institute.
    9. Llorente-Saguer, Aniol & Sheremeta, Roman & Szech, Nora, 2016. "Designing Contests Between Heterogeneous Contestants: An Experimental Study of Tie-Breaks and Bid-Caps in All-Pay Auctions," MPRA Paper 71202, University Library of Munich, Germany.
    10. repec:eee:jeborg:v:144:y:2017:i:c:p:121-132 is not listed on IDEAS

    More about this item

    Keywords

    between-group competition; within-group competition; communication; coordination; contests; experiments;

    JEL classification:

    • C70 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - General
    • D72 - Microeconomics - - Analysis of Collective Decision-Making - - - Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods

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