Even explicit bargaining relies on tacit signals to coordinate expectations

Evidence

This is not necessarily an argument for expecting explicit outcomes as a rule to lean toward exactly those that would have emerged if communication had been impossible; the focal points may certainly be different when speech is allowed, except in some of the artificial cases we have used in our illustrations. But what may be the main principle in tacit bargaining apparently may be at least one of the important principles in the analysis of explicit bargaining. And, since even much so-called “explicit” bargaining includes maneuver, indirect communication, jockeying for position, or speaking to be overheard, or is confused by a multitude of participants and divergent interests, the need for convergent expectations and the role of signals that have the power to coordinate expectations may be powerful. — Thomas C. Schelling, The Strategy of Conflict, 187

Categorization

• XREF: Directly supports the Gambetta private-protection-markets reading: Don Corleone’s arbitration works because parties coordinate on his neutral house as a focal point, analogous to how Schelling’s tacit coordinators work. — connects to: Simple discrete salient limits enable coordinated expectations. — Thomas C. Schelling, The Strategy of Conflict, 602; The bargaining solution’s appeal derives from its focal quality, not its formal derivation — Thomas C. Schelling, The Strategy of Conflict, 668; Mutually perceived signals explain the pull of psychologically dominant equilibria. — Thomas C. Schelling, The Strategy of Conflict, 874 (+12 more)
• ADDENDUM: Relevant to ‘On Sacrifice’ and the Mafia-as-private-judge thesis: coordination on focal enforcement is what substitutes for state legitimacy.

Related

• Bargaining outcomes rest on convergent reflexive expectations, not on force or merit (similarity 0.86)
• Tacit and explicit bargaining form one continuum dependent on coordinated expectations (similarity 0.86)
• Explicit bargaining outcomes rest on prior tacit coordination between rational players (similarity 0.85)
• Pre-arranged communication infrastructure raises the odds tacit bargaining succeeds (similarity 0.85)
• The bargaining solution’s appeal derives from its focal quality, not its formal derivation (similarity 0.85)
• Unilateral, non-reciprocal communication can coordinate both parties’ expectations (similarity 0.84)
• Tacit bargaining over distribution can be conducted only through play itself. (similarity 0.82)
• Desperate mutual need makes even poor signals coordinate action (similarity 0.82)
• Tacit bargaining requires coordinating on equivalent solutions, not just equal-valued ones (similarity 0.81)
• Tacit coordination works through mutually recognized focal points (similarity 0.81)
• Tacit coordination supplies the empirical premise Nash solution concepts require (similarity 0.81)
• Simple discrete salient limits enable coordinated expectations. (similarity 0.81)
• Tacit bargaining forces one party to accept an unfair focal point (similarity 0.81)
• Rational players can correlate strategies without communicating, even with conflicting preferences (similarity 0.80)

Broader Connections

• Tacit and explicit bargaining form one continuum dependent on coordinated expectations #corroborates (0.95) — Thomas C. Schelling, The Strategy of Conflict, 186
• Unilateral, non-reciprocal communication can coordinate both parties’ expectations #corroborates (0.80) — Thomas C. Schelling, The Strategy of Conflict, 201
• Pre-arranged communication infrastructure raises the odds tacit bargaining succeeds #expands (0.75) — Thomas C. Schelling, The Strategy of Conflict, 197