We report an experiment on the effect of intergroup competition on group
coordination in the minimal-effort game (Van Huyck et al., 1990). The
competition was between two 7-person groups. Each player in each group
independently chose an integer from 1 to 7. The group with the higher
minimum won the competition and each of its members was paid according
to the game s original payoff matrix. Members of the losing group were
paid nothing. In case of a tie, each player was paid half the payoff ...
We report an experiment on the effect of intergroup competition on group
coordination in the minimal-effort game (Van Huyck et al., 1990). The
competition was between two 7-person groups. Each player in each group
independently chose an integer from 1 to 7. The group with the higher
minimum won the competition and each of its members was paid according
to the game s original payoff matrix. Members of the losing group were
paid nothing. In case of a tie, each player was paid half the payoff in
the original matrix. This treatment was contrasted with two control
treatments where each of the two groups played an independent
coordination game, either with or without information about the minimum
chosen by the outgroup. Although the intergroup competition does not
change the set of strict equilibria, we found that it improved
collective rationality by moving group members in the direction of
higher-payoff equilibria. Merely providing group members with
information about the minimal-effort level in the other group was not
sufficient to generate this effect.
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