Universität zu Köln

Feldhaus, Christoph, Rockenbach, Bettina ORCID: 0000-0003-2624-1964 and Zeppenfeld, Christopher (2020). Inequality in minimum-effort coordination. J. Econ. Behav. Organ., 177. S. 341 - 371. AMSTERDAM: ELSEVIER. ISSN 1879-1751

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Abstract

Successful coordination is key for economic and societal wealth. The rich literature on the minimum-effort game (MEG) has provided valuable insights into coordination, both theoretically and empirically. Yet, although real-world scenarios often involve asymmetric benefits and/or costs from coordination, most previous studies rely on symmetric MEGs. We investigate the effect of unequal equilibrium payoffs in the MEG. In two experiments, we observe that players are better able to coordinate on an equal rather than an unequal Pareto-dominant equilibrium. We find that the ability to coordinate on the unequal Pareto-dominant equilibrium critically hinges on the costs of miscoordination for the player who benefits most from successful coordination: when her costs are low, she seems able to stabilize the Pareto-dominant equilibrium even if payoffs are highly unequal, whereas co-ordination success worsens substantially when her costs are high. (c) 2020 Elsevier B.V. All rights reserved.

Item Type:	Journal Article
Creators:	Creators Email ORCID ORCID Put Code Feldhaus, Christoph UNSPECIFIED UNSPECIFIED UNSPECIFIED Rockenbach, Bettina UNSPECIFIED orcid.org/0000-0003-2624-1964 UNSPECIFIED Zeppenfeld, Christopher UNSPECIFIED UNSPECIFIED UNSPECIFIED
URN:	urn:nbn:de:hbz:38-321638
DOI:	10.1016/j.jebo.2020.05.009
Journal or Publication Title:	J. Econ. Behav. Organ.
Volume:	177
Page Range:	S. 341 - 371
Date:	2020
Publisher:	ELSEVIER
Place of Publication:	AMSTERDAM
ISSN:	1879-1751
Language:	English
Faculty:	Faculty of Management, Economy and Social Sciences
Divisions:	Center of Excellence C-SEB Faculty of Management, Economics and Social Sciences > Economics > Microeconomics, Institutions and markets > Professorship for Experimental and Behavioral Economics Faculty of Management, Economics and Social Sciences > Economics > Microeconomics, Institutions and markets > Reinhard Selten Institute
Subjects:	Economics
Uncontrolled Keywords:	Keywords Language CORRELATED-EQUILIBRIUM; SOCIAL PREFERENCES; FAILURE; GAMES; COMMUNICATION; AVERSION; MODELS; EQUITY Multiple languages Economics Multiple languages
Refereed:	Yes
URI:	http://kups.ub.uni-koeln.de/id/eprint/32163