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Coordination and Information in Critical Mass Games: An Experimental Study

Published online by Cambridge University Press:  14 March 2025

Giovanna Devetag
Giovanna Devetag*
Affiliation:
Department of Management and Computer Science, University of Trento
*
email: [email protected]
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Abstract

We present experimental results on a repeated coordination game with Pareto-ranked equilibria in which a payoff from choosing an action is positive only if a critical mass of players choose that action. We design a baseline version of the game in which payoffs remain constant for values above the critical mass, and an increasing returns version in which payoffs keep increasing for values above the critical mass. We test the predictive power of security and payoff-dominance under different information treatments. Our results show that convergence to the payoff- dominant equilibrium is the modal limit outcome when players have full information about others’ previous round choices, while this outcome never occurs in the remaining treatments. The paths of play in some groups reveal a tacit dynamic coordination by which groups converge to the efficient equilibrium in a step-like manner. Moreover, the frequency and speed of convergence to the payoff-dominant equilibrium are higher, ceteris paribus, when increasing returns are present. Finally, successful coordination seems to crucially depend on players’ willingness to signal to others the choice of the action supporting the efficient equilibrium.

Keywords

coordinationcritical massinformationlearningsignaling

JEL classification

C91: Laboratory, Individual Behavior C92: Laboratory, Group Behavior C72: Noncooperative Games
Type
Research Article
Information
Experimental Economics , Volume 6 , Issue 1 , June 2003 , pp. 53 - 73
Copyright
Copyright © 2003 Economic Science Association

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