fundamental and strategic uncertainty. I find that market does not improve coordination because the expectation that coordination … failures will occur is self-fulfilling, while cheap talk improves coordination because the signals of willingness to invest …

uncertainty in the framework of a 2x2 coordination game, in which one choice leads to the same payoff regardless of the action of … the other person's play. Cheap talk is found to be effective, as there is much more coordination in both Signal treatments … coordination when messages are permitted. However, in the No Signal treatments, the round-to-round changes in choices induced by …