The Effect of Expected Revenue Proportion and Social Value Orientation Index on Players’ Behavior in Divergent Interest Tacit Coordination Games

Abstract

Tacit coordination games are games in which players need to coordinate with one another, for example, on how to divide resources, while they are not allowed to communicate with each other. In divergent interest tacit coordination games, their interests are not always aligned. For instance, player may need to choose between a solution that maximizes their individual profit or a solution that is perceptually more salient to both players, i.e., a focal point, that will increase the chances for successful coordination. The goal of this study was to examine the effect of two key variables, the Expected Revenue Proportions (ERP) and the player's Social Value Orientation (SVO) on the probability of realizing a focal point solution in divergent interest tacit coordination games. Our results show that there is an interaction between the expected payoff and the SVO. For example, prosocial players tend to implement a social point solution although the expected payoff is less than that of their opponent. Thus, the implementation of a focal point depends on other contextual variables such as the SVO and the expected payoff. The main contribution of this work is showing that the probability to choose a focal point solution is affected by the interaction between SVO and the expected revenue of the player. This finding may contribute to the construction of cognitive models for decision making in diverge interest tacit coordination problems.