Preprint
Article

Competing Conventions with Costly Acquisition of Information

This version is not peer-reviewed.

Submitted:

07 April 2021

Posted:

08 April 2021

Read the latest preprint version here

A peer-reviewed article of this preprint also exists.

Abstract
We consider an evolutionary model of social coordination in a 2x2 game where two groups of agents prefer to coordinate on different actions. Agents can pay a cost to learn their opponent's type: conditional on this decision, they can play different actions with different types. We assess the stability of outcomes in the long-run using stochastic stability analysis. We find that three elements matter for the equilibrium selection: group size, the strength of preferences, and the information's cost. If the cost is too high, agents never learn the type of their opponents in the long-run. If one group is stronger in preferences for its favorite action than the other, or its size is large enough compared to the other group, every agent plays that action. If both groups are strong enough in preferences, or if none of the group's size is large enough, agents play their favorite actions, and they miscoordinate in inter-group interactions. When the cost is sufficiently low, agents always learn the type of their opponent in the long-run. Therefore, they always coordinate. In inside-group interactions, agents always coordinate on their favorite action. In inter-group interactions, agents coordinate on the favorite action of the group that is stronger in preferences or large enough.
Keywords: 
;  ;  
Copyright: This open access article is published under a Creative Commons CC BY 4.0 license, which permit the free download, distribution, and reuse, provided that the author and preprint are cited in any reuse.

Downloads

369

Views

741

Comments

1

Subscription

Notify me about updates to this article or when a peer-reviewed version is published.

Email

Prerpints.org logo

Preprints.org is a free preprint server supported by MDPI in Basel, Switzerland.

Subscribe

© 2025 MDPI (Basel, Switzerland) unless otherwise stated