Coordination Game
A Coordination Game is a type of game in game theory where players benefit from making the same choices or coordinating their actions. The main objective is to reach a mutually beneficial outcome, often represented by multiple equilibria. Players must anticipate the actions of others to achieve the best result, as their payoffs depend on the choices made by all participants.
In a typical coordination game, players may face situations like choosing a meeting point or deciding on a technology standard. Successful coordination leads to higher payoffs for all involved, while failure to coordinate can result in suboptimal outcomes. Examples include traffic systems and business partnerships.