The Minority Game Unpacked: Coordination and Competition in a Team-based Experiment*

In minority games, players in a group must decide at each round which of two available options to choose, knowing that only subjects who picked the minority option obtain a positive reward. Previous experiments on the minority and similar congestion games have shown that players interacting repeatedly are remarkably able to coordinate e ciently, despite not conforming to Nash equilibrium behavior. We conduct an experiment on a minority-of-three game in which each player is a team composed by three subjects. Each team can freely discuss its strategies in the game and decisions must be made via a majority rule. Team discussions are recorded and their content analyzed to detect evidence of strategy co-evolution among teams We thank Marco Tecilla and the CEEL sta for support in the implementation of the experimental software and in the carrying out of the experiments. Financial support from the Italian Ministry of Education, University and Research (PRIN 2005) is gratefully acknowledged. The usual disclaimer applies. Department of Law and Management, University of Perugia, Italy. Corresponding author: [email protected] Department of Economics, University of Bologna, Italy. Philipps University Marburg, Germany