Credible communication and cooperation: Experimental evidence from multi-stage Games
► This paper experimentally investigates cooperation and non-binding communication in a two-stage game. ► Two treatments are considered: one with only pre-play communication and one where subjects can also communicate intra-play between the stages of the game. ► Pre-play communication has a signific...
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Published in | Journal of economic behavior & organization Vol. 81; no. 1; pp. 207 - 219 |
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Main Authors | , |
Format | Journal Article |
Language | English |
Published |
Elsevier B.V
2012
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Subjects | |
Online Access | Get full text |
ISSN | 0167-2681 1879-1751 1879-1751 |
DOI | 10.1016/j.jebo.2011.10.002 |
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Summary: | ► This paper experimentally investigates cooperation and non-binding communication in a two-stage game. ► Two treatments are considered: one with only pre-play communication and one where subjects can also communicate intra-play between the stages of the game. ► Pre-play communication has a significantly lower impact on cooperation when intra-play communication is possible. ► The results suggest that the credibility of pre-play messages may depend crucially on future communication opportunities.
It is well known that communication often serves as a facilitator for cooperation in static games. Yet, communication can serve entirely different purposes in dynamic settings as communication during the game may work as a means for renegotiation, potentially undermining the credibility of cooperative strategies. To explore this issue, this paper experimentally investigates cooperation and non-binding communication in a two-stage game. More specifically, two treatments are considered: one with only pre-play communication and one where subjects can also communicate intra-play between the stages of the game. The results highlight a nontrivial difference concerning the effects of pre-play communication between the two treatments. Sending or receiving pre-play messages has a positive and significant effect on cooperation if there is no possibility of intra-play communication. However, this effect is significantly reduced when when intra-play communication is allowed. The results suggest that the credibility of pre-play messages may depend crucially on future communication opportunities. |
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Bibliography: | ObjectType-Article-2 SourceType-Scholarly Journals-1 ObjectType-Feature-1 content type line 23 |
ISSN: | 0167-2681 1879-1751 1879-1751 |
DOI: | 10.1016/j.jebo.2011.10.002 |