The differential impact of friendship on cooperative and competitive coordination

Chierchia, Gabriele; Tufano, Fabio; Coricelli, Giorgio

Abstract

Friendship is commonly assumed to reduce strategic uncertainty and enhance tacit coordination. However, this assumption has never been tested across two opposite poles of coordination involving either strategic complementarity or substitutability. We had participants interact with friends or strangers in two classic coordination games: the stag-hunt game, which exhibits strategic complementarity and may foster “cooperation”, and the entry game, which exhibits strategic substitutability and may foster “competition”. Both games capture a frequent trade-off between a potentially high paying but uncertain option and a low paying but safe alternative. We find that, relative to strangers, friends are more likely to choose options involving uncertainty in stag-hunt games, but the opposite is true in entry games. Furthermore, in stag-hunt games, friends “tremble” less between options, coordinate better and earn more, but these advantages are largely decreased or lost in entry games. We further investigate how these effects are modulated by risk attitudes, friendship qualities, and interpersonal similarities.

Citation

Chierchia, G., Tufano, F., & Coricelli, G. (2020). The differential impact of friendship on cooperative and competitive coordination. Theory and Decision, 89(4), 423-452. https://doi.org/10.1007/s11238-020-09763-3

• Journal Article Type: Article
• Acceptance Date: May 6, 2020
• Online Publication Date: Jul 6, 2020
• Publication Date: 2020-11
• Deposit Date: May 11, 2020
• Publicly Available Date: Jul 7, 2021
• Journal: Theory and Decision
• Print ISSN: 0040-5833
• Electronic ISSN: 1573-7187
• Peer Reviewed: Peer Reviewed
• Volume: 89
• Issue: 4
• Pages: 423-452
• DOI: https://doi.org/10.1007/s11238-020-09763-3
• Keywords: Applied Psychology; Arts and Humanities (miscellaneous); General Economics, Econometrics and Finance; General Decision Sciences; General Social Sciences; Developmental and Educational Psychology; Computer Science Applications
• Public URL: https://nottingham-repository.worktribe.com/output/4417490
• Publisher URL: https://link.springer.com/article/10.1007/s11238-020-09763-3
• Additional Information: First Online: 6 July 2020