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The costs and benefits of coordinating with a different group

Grout, Paul A.; Mitraille, S�bastien; Sonderegger, Silvia

Authors

GAUTAM PAUL gautam.paul@nottingham.ac.uk
Associate Professor in Pharmacy Education & Development

S�bastien Mitraille



Abstract

We consider a setup where agents care about i) taking actions that are close to their preferences, and ii) coordinating with others. The preferences of agents in the same group are drawn from the same distribution. Each individual is exogenously matched with other agents randomly selected from the population. Starting from an environment where everyone belongs to the same group, we show that introducing agents from a different group (whose preferences are uncorrelated with those of each of the incumbents) generates costs but may also (surprisingly) generate benefits in the form of enhanced coordination.

Citation

Grout, P. A., Mitraille, S., & Sonderegger, S. (2015). The costs and benefits of coordinating with a different group. Journal of Economic Theory, 160, https://doi.org/10.1016/j.jet.2015.09.006

Journal Article Type Article
Acceptance Date Sep 18, 2015
Online Publication Date Sep 25, 2015
Publication Date Dec 1, 2015
Deposit Date Jul 21, 2015
Publicly Available Date Mar 29, 2024
Journal Journal of Economic Theory
Print ISSN 0022-0531
Electronic ISSN 0022-0531
Publisher Elsevier
Peer Reviewed Peer Reviewed
Volume 160
DOI https://doi.org/10.1016/j.jet.2015.09.006
Keywords Diversity, Coordination, Social Interactions, Value of Information, Complementarities
Public URL https://nottingham-repository.worktribe.com/output/980886
Publisher URL https://www.sciencedirect.com/science/article/pii/S0022053115001787
Related Public URLs http://www.journals.elsevier.com/journal-of-economic-theory/