Group Play in Games and the Role of Consent in Network Formation

Abstract:     
We study games played between groups of players, where a given group decides which strategy it will play through a vote by its members. When groups consist of two voting players, our games can also be interpreted as network-formation games. In experiments on Stag Hunt games, we find a stark contrast between how groups and individuals play, with payoffs playing a primary role in equilibrium selection when individuals play, but the structure of the voting rule playing the primary role when groups play.

We develop a new solution concept, robust-belief equilibrium, which explains the data that we observe. We provide results showing that this solution concept has application beyond the particular games in our experiments.

Number of Pages in PDF File: 42

Keywords: Groups, Networks, Game Theory, Equilibrium Selection, Equilibrium Refinement, Majority Voting, Group Play, Robust-belief Equilibrium

JEL Classification: D85, A14, C72, C91, D71, D72

working papers series