Conditional games: A framework for coordination

Game theory is often proposed as a framework within which to model coordination. Neoclassical game theory, however, focuses exclusively on individual preferences, whereas coordination requires a concept of group preference as well as individual preferences. Conditional game theory differs from classical theory in two fundamental ways. First, it involves a utility structure that permits agents to define their preferences conditioned on the preferences of other agents, and second, it accommodates a notion of group rationality as well as individual rationality. The resulting framework permits a notion of group preferences to be defined, and leads to the development of a metric to characterize the intrinsic ability of the members of a group to coordinate.