Salience and focusing in pure coordination games.

This article is devoted to explaining and justifying the choice of salient equilibria or focal points in pure coordination games -- games in which players have identical preferences over the set of possible outcomes. Focal points, even when they arise as framing effects based on the labelling of options, are intuitively obvious choices, and experimental evidence shows that people often coordinate successfully by choosing them. In response to arguments that focusing is not rationally justified, a qualified justification and psychological explanation is offered in terms of a form of reasoning called the Stackelberg heuristic, which has been used to explain the selection of payoff-dominant (Pareto-optimal) equilibria in common-interest games. Pure coordination games, if appropriately modelled, are shown to be reducible to common-interest games with payoff-dominant equilibria, and it is argued that focusing can therefore be explained by the Stackelberg heuristic.