A key factor in coordinating to the payoff dominant outcome in minimum effort coordination games is:
A) the creation of optimistic beliefs about the effort choices of one's peers; even small degrees of uncertainty can lead to large coordination failures.
B) the presence of a strictly dominant strategy.
C) the presence of multiple dominated strategies.
D) that interactions must be anonymous and occur without any possibility of pre-play communication.

Question

Quizplus · Accepted Answer

The creation of optimistic beliefs about the effort choices of one's peers is crucial in achieving the payoff dominant outcome in minimum effort coordination games. Even a small amount of uncertainty can lead to significant coordination failures, as individuals may choose lower effort levels if they are unsure about the efforts of others, thus preventing the group from reaching the most beneficial outcome for all.

A Key Factor in Coordinating to the Payoff Dominant Outcome