Coordination when there are restricted and unrestricted options

Coordination when there are restricted and unrestricted options

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Article ID: iaor20171951
Volume: 83
Issue: 1
Start Page Number: 107
End Page Number: 129
Publication Date: Jun 2017
Journal: Theory and Decision
Authors: , ,
Keywords: game theory, experiment
Abstract:

One might expect that, in pure coordination games, coordination would become less frequent as the number of options increases. Contrary to this expectation, we report an experiment which found more frequent coordination when the option set was unrestricted than when it was restricted. To try to explain this result, we develop a method for eliciting the general rules that subjects use to identify salient options in restricted and unrestricted sets. We find that each such rule, if used by all subjects, would generate greater coordination in restricted sets. However, subjects tend to apply different rules to restricted and unrestricted sets.

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