Journal Article

Cooperation in Experimental Games of Strategic Complements and Substitutes

Jan Potters and Sigrid Suetens

in The Review of Economic Studies

Published on behalf of Review of Economic Studies Ltd

Volume 76, issue 3, pages 1125-1147
Published in print July 2009 | ISSN: 0034-6527
Published online July 2009 | e-ISSN: 1467-937X | DOI: http://dx.doi.org/10.1111/j.1467-937X.2009.00548.x
Cooperation in Experimental Games of Strategic Complements and Substitutes

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  • Game Theory and Bargaining Theory
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We conduct a laboratory experiment aimed at examining whether strategic substitutability and strategic complementarity have an impact on the tendency to cooperate in finitely repeated two-player games with a Pareto-inefficient Nash equilibrium. We find that there is significantly more cooperation when actions exhibit strategic complementarities than in the case of strategic substitutes. The difference is to some extent driven by a difference in the speed with which some pairs reach stable full cooperation, but mainly by differences in choices of pairs that do not succeed in reaching full cooperation.

Keywords: C73; C92

Journal Article.  8224 words.  Illustrated.

Subjects: Game Theory and Bargaining Theory ; Design of Experiments

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