Collectivism-individualism: Strategic behavior in tacit coordination games.

Abstract

The effect of culture on strategic interaction has been widely explored. However, the effect of the cultural background on focal point selection in tacit coordination games has not yet been examined. To accomplish this goal, in this study we have focused on the individual level of analysis. That is, we constructed a strategic profile to model the behavior of each individual player and then used unsupervised learning methods on the individual data points. We have chosen to examine two groups of participants, Israelis (ICB) and Chinese (CCB), each belonging to a different cultural background representing individualist and collectivist societies, respectively. Clustering the individual strategic profiles has allowed us to gain further insights regarding the differences between the behavioral strategies of each cultural group. The results of this study demonstrate that the cultural background has a profound effect on the strategic profile and on the ability to succeed in tacit coordination games. Moreover, the current study emphasizes the importance of relying on the individual level of analysis and not only on the group level of analysis. The implications of these results and potential future studies are discussed.