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The dark side of friendship: envy

  • Ramón Cobo-Reyes

    ()

    (Department of Economic Theory and Economic History, University of Granada.)

  • Natalia Jiménez

    ()

    (Department of Economic Theory and Economic History, University of Granada.)

This paper studies the e¤ect of social relations on the convergence to the e¢ cient equilibrium in a 2x2 coordination game. We employ a 2x2 factorial design in which we explore two di¤erent games with asymmetric payo¤s and two matching protocols: .friends.versus .strangers.. In the .rst game payo¤s of the worse o¤ player are the same in the two equilibria, whereas in the second game, this player must sacri.ce her own payo¤ for achieving the e¢ cient equilibrium. Results show that .strangers. coor- dinate more frequently in the e¢ cient equilibrium than .friends.in both games. Regarding network measures, (such us degree in, degree out and betweenness) they are all positively correlated with the strategy which leads to the e¢ cient outcome except clustering. In addition, envy is a salient factor in explaining e¢ cient convergence.

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File URL: http://www.ugr.es/~teoriahe/RePEc/gra/wpaper/thepapers07_07.pdf
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Paper provided by Department of Economic Theory and Economic History of the University of Granada. in its series ThE Papers with number 07/07.

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Length: 39 pages
Date of creation: 31 Dec 2007
Date of revision:
Handle: RePEc:gra:wpaper:07/07
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