We study a model in which heterogenous boundedly rational agents interact locally in order to play a coordination game. Agents di®er in their mobility with mobile agents being able to relocate within a country. The model yields the following predictions: (1) mobile agents always bene ̄t from increased mobility, (2) immobile agents bene ̄t from increased mobility at low levels of mobility, (3) imm...

We present a series of experimental coordination games with a payoff-dominant and a risk-dominant Nash equilibrium. We examine in how far local interaction structures have effects on players' strategy choices. Our three major observations are the following: first, local interaction with open neighborhoods along a circle leads to less coordination on the payoff-dominant equilibrium than interact...