Chapter 34 Coordination Success in Non-cooperative Large Group Market Entry Games
Published on Jan 1, 2008
· DOI :10.1016/S1574-0722(07)00034-0
Publisher Summary Subsequent experimental studies of the market entry game and his associates, which systematically manipulated the information structure of the game, compared behavior in the domains of gains and losses, or introduced private information and asymmetry between players, have shown that this “magic” is robust. Under a wide variety of experimental conditions, interacting players in large groups playing the market entry game with no communication among them rapidly achieve coordination success that is accounted for on the aggregate level by a Pareto deficient equilibrium solution. When the entry fee is private information, and only the distribution of entry fees in the population is known, the effects of asymmetry between players can be studied. Whether players are symmetric or not, each player is faced on each period with a binary choice between earning a fixed payoff, regardless of the actions taken by the other players, or an uncertain payoff which is a linear function of the difference cm.