In this paper we present the results of an experiment aimed at testing the ability of consumers to coordinate actions in a market in which network externalities are present. Such markets are characterized by the necessity for consumers to believe that a certain minimum number of people will buy...

This paper offers an information-based model of social interaction, and analyzes optimal investment and pricing of services that facilitate interaction in a duopoly. Agents have uncertainty over their preferences but are aware that they are correlated with others’, so there exists an incentive...

We consider a pure exchange economy with private ownership in which consumers have interdependent preferences. Hence, consumers’ preferences are defined on the states of the economy. In a Walras equilibrium for such an economy, it may, of course, be possible for two or more consumers to...

In this paper we present the results of an experiment aimed at testing the ability of consumers to coordinate actions in a market in which network externalities are present. Such markets are characterized by the necessity for consumers to believe that a certain minimum number of people will buy...

We consider a class of two-player quadratic games under incomplete information to study the relation between exogenous coordination motives and strategic interactions in information acquisition. The players make decisions in two stages. They decide about information acquisition in the first...

Although rational consumers without bequest motives are better off investing exclusively with annuitized instruments in partial equilibrium, we demonstrate the welfare effect of annuitization is ambiguous in general equilibrium on account of pecuniary externalities. Absent institutional...

Two players choose whether to coordinate on a project. Each of them is endowed with some information, and if both possess a sufficient amount then coordination is profitable. In order to facilitate coordination the players reveal information to one another. However, some players are concerned...

Why do privacy scholars have inconsistent attitudes about social norms? They mostly agree that social norms play a key role in ensuring adequate informational privacy, particularly “privacy in public.” But they ignore norms when making concrete proposals about how to preserve privacy....

There has been much speculation that information technology can be used to enhance coordination across organizations. The research on the matter is less than convincing, in part due to the absence of models that capture the complexity of the phenomenon, and in part due to problems of...