TY  - RPRT
CY  - Toulouse
ID  - publications46521
UR  - http://tse-fr.eu/pub/127599
A1  - Alaoui, Larbi
A1  - Janezic, Katharina A.
A1  - Penta, Antonio
Y1  - 2022/12//
N2  - How coordination can be achieved in isolated, one-shot interactions without com-munication and in the absence of focal points is a long-standing question in game theory. We show that a cost-benefit approach to reasoning in strategic settings delivers sharp theoretical predictions that address this central question. In particular, our model predicts that, for a large class of individual reasoning processes, coordination in some canonical games is more likely to arise when players perceive heterogeneity in their cognitive abilities, rather than homogeneity. In addition, and perhaps contrary to common perception, it is not necessarily the case that being of higher cognitive sophistication is beneficial to the agent: in some coordination games, the opposite is true. We show that subjects’ behavior in a laboratory experiment is consistent with the predictions of this model, and reject alternative coordination mechanisms. Overall, the empirical results strongly support our model.
PB  - TSE Working Paper
T3  - TSE Working Paper
KW  - coordination
KW  - cognitive cost
KW  - sophistication
KW  - strategic reasoning
KW  - value of reasoning
M1  - working_paper
TI  - Coordination and Sophistication
AV  - public
EP  - 43
ER  -