On Smiles, Winks, and Handshakes as Coordination Devices
Paola Manzini, Queen Mary, University of London
Abdolkarim Sadrieh, University of Magdeburg
Nicolaas J. Vriend, Queen Mary, University of London
The Economic Journal, 2009, Vol. 119, April, p. 826-854

pdf Full paper (PDF format)

smh "Trust me, I'm smiling" (article in The Sydney Morning Herald)

qm "How does our behaviour add up?" (QM Research page on Mind and Society)

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 recognised 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.

J.E.L. classification codes. C72, C91, C92

Keywords. Coordination games, Pareto efficiency, Trust, Cues, Signals

Nick Vriend, n.vriend@qmul.ac.uk
Last modified 2015-06-17