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Coordination and Cooperation Problems in Network Good Production

Author

Listed:
  • Antonie Knigge

    (Department of Sociology/ICS, Utrecht University, Heidelberglaan 2, 3584 CS, Utrecht, The Netherlands)

  • Vincent Buskens

    (Department of Sociology/ICS, Utrecht University, Heidelberglaan 2, 3584 CS, Utrecht, The Netherlands
    Erasmus School of Law, Erasmus University Rotterdam, Burgemeester Oudlaan 50, 3062 PA, Rotterdam, The Netherlands)

Abstract

If actors want to reach a particular goal, they are often better off forming collaborative relations and investing together rather than investing separately. We study the coordination and cooperation problems that might hinder successful collaboration in a dynamic network setting. We develop an experiment in which coordination problems are mainly due to finding partners for collaboration, while cooperation problems arise at the investment levels of partners who have already agreed to collaborate. The results show that as costs of forming links increase, groups succeed less often in solving the coordination problem. Still, if subjects are able to solve the coordination problem, they invest in a suboptimal way in the network good. It is mostly found that if cooperation is successful in terms of investment, it is due to subjects being able to monitor how much their partners invest. Moreover, subjects deal better with the coordination and cooperation problems as they gain experience.

Suggested Citation

  • Antonie Knigge & Vincent Buskens, 2010. "Coordination and Cooperation Problems in Network Good Production," Games, MDPI, vol. 1(4), pages 1-24, September.
    • Handle: RePEc:gam:jgames:v:1:y:2010:i:4:p:357-380:d:9706
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    References listed on IDEAS

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    1. Takács, Károly & Janky, Béla, 2007. "Smiling contributions: Social control in a public goods game with network decline," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 378(1), pages 76-82.
    2. Calvo-Armengol, Antoni, 2004. "Job contact networks," Journal of Economic Theory, Elsevier, vol. 115(1), pages 191-206, March.
    3. Bramoulle, Yann & Kranton, Rachel, 2007. "Public goods in networks," Journal of Economic Theory, Elsevier, vol. 135(1), pages 478-494, July.
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    Cited by:

    1. Rong, Rong & Houser, Daniel, 2015. "Growing stars: A laboratory analysis of network formation," Journal of Economic Behavior & Organization, Elsevier, vol. 117(C), pages 380-394.
    2. Boris van Leeuwen & Theo Offerman & Arthur Schram, 2013. "Superstars need Social Benefits: An Experiment on Network Formation," Tinbergen Institute Discussion Papers 13-112/I, Tinbergen Institute.
    3. Boris van Leeuwen & Theo Offerman & Arthur Schram, 2020. "Competition for Status Creates Superstars: an Experiment on Public Good Provision and Network Formation," Journal of the European Economic Association, European Economic Association, vol. 18(2), pages 666-707.

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