Week 4 - Co-ordination in simultaneous move games

Question 1

True or false: Co-ordination games have multiple Nash equilibriua

Answer 1

True

Question 2

What is a focal point

Answer 2

Some equilibria are more focal than others due to shared history, language and culture. In this way we can distinguish which equilibria is more likely to be played

Question 3

What is the difference between primary and secondary salience?

Answer 3

primary salience is what is your favourite, secondary salience is what you think is the favourite of others.

Question 4

What is schelling salience?

Answer 4

How everyone as a team could solve the coordination problem.

Question 5

What is the stag hunt game?

Answer 5

2 players deciding to hunt either stag or hare. Stag gives more utility but can only be caught if both players hunt it.

Question 6

What are the 2 pareto-ranked nash equilibrium in the stag hunt game

Answer 6

stag stag or hare hare
s,s = payoff dominant eq
h,h = risk dominant eq

Question 7

In experiment, what result do we see in the stag hunt game?

Answer 7

Play converges to the risk dominant equilibrium, but it can depend on payoffs.

Question 8

What are 2 ways to facilitate effective co-ordination in the stag hunt game?

Answer 8

pre play communication
outside option - P1 decides whether to play or award a certain payoff to each. If p1 plays, p2 knows they will choose the stag

Question 9

What is the minimum effort game?

Answer 9

Payoffs depend on your effort and the effort in your group e.g. group projects. Effort is costly, but payoffs increase in the player who puts in the minimum effort of the group.

Question 10

In experiment, what do we see in the minimum effort game?

Answer 10

Large groups gradually converge to to the most inefficient equilibrium. 90% of small groups converge to payoff dominant equilibrium, but only with partner matching. With random rematching, it’s the same as large groups.

Question 11

What is inefficient lock in?

Answer 11

Coordination on an inefficient equilibrium.

Question 12

What ways can you overcome inefficient lock-in (4)

Answer 12

• Cash incentive for effective co-operation
• revealing information about all choices not just the minimum
• communication by a leader
• repeating the game

Question 13

What is the critical mass game?

Answer 13

In a group of 6, an uprising is successful if 5 revolt. if you revolt and uprising is successful, you get 100. If you fail you get 5. If you stay out you get 60