Learning Conditional Behavior in Similar Stag Hunt Games

This paper reports an experiment that varies the range of Stag Hunt games experienced by the participants. The experiment provides evidence that changing the range influences the likelihood of efficient conventions emerging. In the experiment, we observe conditional behavior, much like risk dominance, emerging with experience. We develop a model of conditional expectations to explain these stylized facts that depends crucially on the assumption that after a brief learning period participants categorize their experience using the same relative bandwidth in both treatments even though the range of experience is twice as large in treatment 1 as it is in treatment 2. The assumption can not be rejected by the data. The analysis provides a formal example in which increasing experienced diversity by changing the way similar experiences are categorized increases the likelihood of efficient conventions emerging in communities playing similar Stag Hunt games.