A population of players is considered in which each player may select his neighbors in order to play a 2 × 2 coordination game with each of them. We analyze how the payoffs in the underlying coordination game effect the resulting equilibrium neighborhood resp. network structure.

In an experimental 2x2 coordination game with two strict equilibria we observe that, in contrast to equilibrium selection theory (Harsanyi and Selten 1988), only half of the subjects choose the strategy that relates to the payoff- and risk-dominant equilibrium. We propose modified risk dominance...