On Smiles, Winks, and Handshakes as Coordination Devices

U of London Queen Mary Economics Working Paper No. 456

28 Pages Posted: 4 Oct 2002

See all articles by Paola Manzini

Paola Manzini

University of St. Andrews - School of Economics and Finance; Institute for the Study of Labor (IZA)

Abdolkarim Sadrieh

University of Magdeburg

Nicolaas J. Vriend

Queen Mary, University of London - Department of Economics

Multiple version iconThere are 2 versions of this paper

Date Written: March 2002

Abstract

In an experimental study we examine a variant of the 'minimum effort game', a coordination game with Pareto ranked equilibria, and risk considerations pointing to the least efficient equilibrium. We focus on the question whether simple cues such as smiles, winks and handshakes could be recognized and employed by the players as a tell-tale sign of each other's trustworthiness, thus enabling them to coordinate on the more risky but more rewarding Pareto efficient equilibrium. Our experimental results show that such cues may indeed play a role as coordination devices as their information value is significant and substantial.

JEL Classification: C72, C91, C92

Suggested Citation

Manzini, Paola and Sadrieh, Abdolkarim and Vriend, Nicolaas J., On Smiles, Winks, and Handshakes as Coordination Devices (March 2002). U of London Queen Mary Economics Working Paper No. 456. Available at SSRN: https://ssrn.com/abstract=310699 or http://dx.doi.org/10.2139/ssrn.310699

Paola Manzini

University of St. Andrews - School of Economics and Finance ( email )

North St
Saint Andrews, Fife KY16 9AJ
United Kingdom

HOME PAGE: http://www.st-andrews.ac.uk/~pm210/

Institute for the Study of Labor (IZA)

P.O. Box 7240
Bonn, D-53072
Germany

Abdolkarim Sadrieh

University of Magdeburg ( email )

Faculty of Economics and Management
Postbox 4120
39016 Magdeburg
Germany

HOME PAGE: http://www.ww.uni-magdeburg.de

Nicolaas J. Vriend (Contact Author)

Queen Mary, University of London - Department of Economics ( email )

Mile End Road
London, E1 4NS
United Kingdom
+44 (0)20 7882 5096 (Phone)
+44 (0)20 8983-3580 (Fax)

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