Standard game theory turns a blind eye toward social interaction between the players in a game. Hence, a given game offers the same set of equilibria regardless of the identities of the players and the specifics of the social context. The predictive value of game theory is severely limited as a...

The notion of sympathy is analyzed in the setting of coordination between duopolists, and in the setting of the sale of a used car of possibly low quality. In both cases, the analysis suggests a number of empirical regularities concerning the effects of social interaction, physical distance, and...

The notion of sympathy is analyzed in the setting of coordination between duopolists, and in the setting of the sale of a used car of possibly low quality. In both cases, the analysis suggests a number of empirical regularities concerning the effects of social interaction, physical distance, and...