Social exchange vs private preferences: An experiment in a new Battle-of-the-Sexes Game

Authors: Olivier Bonroy, Alexis Garapin, Benjamin Ouvrard

Abstract

We investigate with an experiment a new Battle-of-the-Sexes game in which the social exchange effect is independent from the private preferences effect. The agents' gains are based on a payoff function built from a social distance model. In addition to the two equilibria where the private preferences of each of the two players are maximized, we consider a "non-biased equilibrium" where the players' payoffs mainly depend on social exchange. Experimental evidence confirms our prediction that the "non-biased equilibrium" improves players' coordination and predominates. In a game with more actions, this predominance is reduced to the benefit of the outcome where the private preferences of both players are maximized. Moreover, we show that the latter outcome predominates when the "non-biased equilibrium" does not exist. Further analysis shows that, in this case, subjects consider that other actions are dominated.