Equilibrium Selection in Global Games with Strategic Complementarities

Publication Year
2003

Type

Journal Article
Abstract
We study games with strategic complementarities, arbitrary numbers of players and actions, and slightly noisy payoff signals. We prove limit uniqueness: as the signal noise vanishes, the game has a unique strategy profile that survives iterative dominance. This generalizes a result of Carlsson and van Damme (Econometrica 61 (1993) 989-1018) for two-player, two-action games. The surviving profile, however, may depend on fine details of the structure of the noise. We provide sufficient conditions on payoffs for there to be noise-independent selection.
Journal
Journal of Economic Theory
Volume
108
Issue
1
Pages
- 44
Date Published
January 2003
ISBN
0022-0531, 0022-0531