One Step at a Time: Does Gradualism Build Coordination?

TL;DR

This paper explores whether gradual increases in contribution stakes over time improve group coordination, supported by experiments and a belief-based learning model, showing gradualism enhances coordination success.

Contribution

It introduces and tests the effectiveness of gradual stake increases as a mechanism to promote coordination, validated through laboratory experiments and theoretical modeling.

Findings

Gradual stake increases lead to better coordination at high stakes.

Belief-based learning model supports the experimental results.

Gradualism outperforms immediate high-stake or abrupt increases.

Abstract

This study investigates a potential mechanism to promote coordination. With theoretical guidance using a belief-based learning model, we conduct a multi-period, binary-choice, and weakest-link laboratory coordination experiment to study the effect of gradualism - increasing the required levels (stakes) of contributions slowly over time rather than requiring a high level of contribution immediately - on group coordination performance. We randomly assign subjects to three treatments: starting and continuing at a high stake, starting at a low stake but jumping to a high stake after a few periods, and starting at a low stake while gradually increasing the stakes over time (the Gradualism treatment). We find that relative to the other two treatments, groups coordinate most successfully at high stakes in the Gradualism treatment. We also find evidence that supports the belief-based learning model. These findings point to a simple mechanism for promoting successful voluntary coordination.