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Abstract
We propose the Point Beauty Contest, a mechanism to identify the distribution of focal points on the individual level. By contrast to conventional coordination, subjects coordinate by the distribution of points. This allows for nuanced coordination strategies, as subjects can invest in multiple alternatives at the same time and weigh their choice. A subject´s strategy choice then reveals her perception of the distribution of focal points. In an experiment on the elicitation of social norms, we compare the mechanism with conventional coordination. The data confirms the theoretical predictions regarding coordination behavior and demonstrates that the proposed technique is suited to identify the distribution of focal points on the individual level. Using Monte Carlo simulations, we find that the proposed mechanism identifies focal points on the population level more efficiently than conventional coordination. We point to the possibility of using the mechanism as a simple method to directly measure strategic uncertainty.
Document type: | Working paper |
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Series Name: | Discussion Paper Series / University of Heidelberg, Department of Economics |
Volume: | 0667 |
Place of Publication: | Heidelberg |
Date Deposited: | 27 Sep 2019 14:05 |
Date: | September 2019 |
Number of Pages: | 22 |
Faculties / Institutes: | The Faculty of Economics and Social Studies > Alfred-Weber-Institut for Economics |
DDC-classification: | 330 Economics |
Uncontrolled Keywords: | coordination, focal points, games theory, strategic uncertainty, social norms |
Series: | Discussion Paper Series / University of Heidelberg, Department of Economics |
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Available Versions of this Item
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Identifying the Ranking of Focal Points in Coordination Games on the Individual Level. (deposited 27 Mar 2019 12:27)
- Point beauty contest: measuring the distribution of focal points on the individual level. (deposited 27 Sep 2019 14:05) [Currently Displayed]