On March 21, Giacomo Sillari will give a joint LogiCIC/LIRa talk.
Everyone is cordially invited!
Speaker: Giacomo Sillari (Scuola Normale Superiore di Pisa)
Title: You better play 7: mutual versus common knowledge of advice in a weak-link experiment
Room: Science Park 107, room F1.15
Time: Thursday, 21 March, 15:30-17:30
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 learningphase 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.