Network architecture, salience and coordination

Syngjoo Choi, Douglas Gale, Shachar Kariv, Thomas Palfrey

    Research output: Contribution to journalArticlepeer-review

    Abstract

    This paper reports the results of an experimental investigation of dynamic games in networks. In each period, the subjects simultaneously choose whether or not to make an irreversible contribution to the provision of an indivisible public good. Subjects observe the past actions of other subjects if and only if they are connected by the network. Networks may be incomplete so subjects are asymmetrically informed about the actions of other subjects in the same network, which is typically an obstacle to the attainment of an efficient outcome. For all networks, the game has a large set of (possibly inefficient) equilibrium outcomes. Nonetheless, the network architecture makes certain strategies salient and this in turn facilitates coordination on efficient outcomes. In particular, asymmetries in the network architecture encourage two salient behaviors, strategic delay and strategic commitment. By contrast, we find that symmetries in the network architecture can lead to mis-coordination and inefficient outcomes.

    Original languageEnglish (US)
    Pages (from-to)76-90
    Number of pages15
    JournalGames and Economic Behavior
    Volume73
    Issue number1
    DOIs
    StatePublished - Sep 2011

    Keywords

    • Coordination
    • Experiment
    • Monotone games
    • Networks
    • Strategic commitment
    • Strategic delay

    ASJC Scopus subject areas

    • Finance
    • Economics and Econometrics

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