Players choose a stochastic choice rule, assigning a probability of “investing” as a function of a state. Players receive a return to investment that is increasing in the proportion of others who invest and the state. In addition, they incur a small cost associated with adapting the...

There is tight link between coordination and common knowledge. The role of higher order beliefs in static incomplete information games has been widely studied. In particular, information frictions breaks down common of payoffs. A large literature in economics examines dynamic coordination...

Common knowledge plays an important role in coordination problems and coordination problems are central to many areas of economic policy. In this paper, I review some common knowledge puzzles culminating in the electronic mail game. These puzzles may seem distant from practical concerns....