When learning meets salience

Research output: Contribution to journalArticlepeer-review

Abstract

Behavior in one-shot coordination games with common knowledge labels can be described by theories of salience and focal points. Behavior in repeated games, including coordination games, can be explained by theories of learning. This paper considers games in which both theories apply, repeated coordination games with common knowledge labels. The research question asks how players combine the two sources of information - salience and the history of play - when making their choices. We specifically ask whether salience, normally considered as a one-shot strategy, continues to influence players' actions beyond the first round, even while the player might learn from the history of play. We explore two possible mechanisms for such a continuing effect of salience: via an influence on prior beliefs, and/or via a bias, given beliefs. Regression analysis of individual-level choices shows that salience, normally considered only in the context of one-shot games, does exert a lasting effect, with the precise mechanism depending on the details of the game.

Original languageEnglish
Pages (from-to)241-266
Number of pages26
JournalTheory and Decision
Volume74
Issue number2
DOIs
StatePublished - Feb 2013

Keywords

  • Coordination games
  • Learning in games
  • Salience

ASJC Scopus subject areas

  • General Decision Sciences
  • Developmental and Educational Psychology
  • Arts and Humanities (miscellaneous)
  • Applied Psychology
  • General Social Sciences
  • Economics, Econometrics and Finance (all)
  • Computer Science Applications

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