Communication structure and coalition-proofness: experimental evidence

The paper analyzes the role of the structure of communication—i.e. who is talking with whom—in a coordination game. We run an experiment in a three-player game with Pareto ranked equilibria, where a pair of players has a profitable joint deviation from the Pareto-superior equilibrium. We show that specific communication structures lead to different ‘coalition-proof’ equilibria in this game. Results match the theoretical predictions. Subjects communicate and play the Pareto-superior equilibrium when communication is public. When pairs of players exchange messages privately, subjects play the Pareto-inferior equilibrium. Even in these latter cases, however, players’ beliefs and choices tend to react to messages, despite the fact that these are not credible. (This abstract was borrowed from another version of this item.)