Coordination and Status Influence

Abstract

We develop a model to explain why the influence of higher-status individuals is often accepted even when status is not an indication of superior information or competence. We propose such acceptance as a rational strategy in cases where coordination is important. In our model agents must select from among a set of alternatives after witnessing the choices of some group of initial movers, one of whom is assumed to be of high status. These agents would like to select the better alternative, but would also like to coordinate with as many others as possible. If a high-status individual is more prominent, he or she can be used as a coordination device. We determine in what situations agents weigh the behavior of higher-status agents more heavily than that of other agents, and whether the total utility of agents is improved as a result of the existence of high-status individuals.