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You better play 7: mutual versus common knowledge of advice in a weak-link experiment

Devetag, Giovanna, Hosni, Hykel and Sillari, Giacomo (2013) You better play 7: mutual versus common knowledge of advice in a weak-link experiment. Synthese, 190 (8). pp. 1351-1381. ISSN 0039-7857

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Abstract

This paper presents the results of an experiment on mutual versus common knowledge of advice in a two-player weak-link game with random matching. Our experimental subjects play in pairs for thirteen rounds. After a brief learning phase common to all treatments, we vary the knowledge levels associated with external advice given in the form of a suggestion to pick the strategy supporting the payoff- dominant equilibrium. Our results are somewhat surprising and can be summarized as follows: in all our treatments both the choice of the efficiency-inducing action and the percentage of efficient equilibrium play are higher with respect to the control treatment, revealing that even a condition as weak as mutual knowledge of level 1 is sufficient to significantly increase the salience of the efficient equilibrium with respect to the absence of advice. Furthermore, and contrary to our hypothesis, mutual knowledge of level 2 induces, under suitable conditions, successful coordination more frequently than common knowledge.

Item Type: Article
Official URL: http://www.springerlink.com/content/0039-7857?MUD=...
Additional Information: © 2012 Springer Science+Business Media B.V.
Library of Congress subject classification: H Social Sciences > HB Economic Theory
Journal of Economic Literature Classification System: D - Microeconomics > D0 - General > D01 - Microeconomic Behavior: Underlying Principles
D - Microeconomics > D8 - Information, Knowledge, and Uncertainty > D83 - Search; Learning; Information and Knowledge; Communication; Belief
Sets: Collections > Economists Online
Research centres and groups > Centre for Philosophy of Natural and Social Science (CPNSS)
Rights: http://www.lse.ac.uk/library/usingTheLibrary/academicSupport/OA/depositYourResearch.aspx
Date Deposited: 02 Nov 2012 13:38
URL: http://eprints.lse.ac.uk/47260/

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