Using turn taking to mitigate coordination and conflict problems in the repeated Battle of the Sexes game

Abstract

The Battle of the Sexes game, which captures both coordination and conflict problems, has been applied to a wide range of situations. We show that, by reducing distributional conflict and enhancing coordination, (eventual) turn taking supported by a "turn taking with independent randomizations" strategy allows players to engage in intertemporal sharing of the gain from cooperation. Using this insight, we decompose the benefit from turn taking into conflict-mitigating and coordination-enhancing components. Our analysis suggests that an equilibrium measure of the "degree of intertemporal conflict" provides an intuitive way to understand the sources of welfare gain from turn taking in the repeated Battle of the Sexes game. We find that when this equilibrium measure is lower, players behave less aggressively and the welfare gain from turn taking is higher. © 2008 Springer Science+Business Media, LLC.