Brown Bag Seminar: Mariam Nanumyan

Efficiency Gains of Social Influence in a Minimum Effort Game

Mariam Nanumyan, UCLouvain CORE

In this paper we explore how the coordination of effort choice in a minimum effort game evolves if individual expectations about the effort of the other players is influenced by own experience as well as by communication within a social network. Players are repeatedly randomly partitioned in groups to play a minimum effort game and choose their effort based on their beliefs about the minimal effort shown by the other members of their group. Beliefs of an agent are updated using own observations as well as the minimal effort experienced by social contacts of that agent. Additionally, social influence is captured by allowing agents to communicate their beliefs about the effort distribution to their social contacts. Relying on extensive simulations the impact of initial beliefs, as well as key parameters determining the importance of direct observations respectively belief communication in the social network on the emerging (long run) effort level is analysed. Furthermore, the influence of the topology of the social network is studied. We find that increasing the role of social influence through communication about beliefs tends to increase the average effort chosen in the population, thereby improving the efficiency of the outcome which emerges.
(joint work with Jasmina Arifovic and Herbert Dawid)