Games with Strategic Heterogeneity
AbstractThis paper studies games with both strategic substitutes and strategic complements, and more generally, games with strategic heterogeneity (GSH). Such games may behave differ- ently from either games with strategic complements or games with strategic substitutes. Under mild assumptions (on one or two players only), the equilibrium set in a GSH is totally unordered (no two equilibria are comparable in the standard product order). Moreover, under mild assumptions (on one player only), parameterized GSH do not allow decreasing equilibrium selections. In general, this cannot be strengthened to conclude in- creasing selections. Monotone comparative statics results are presented for games in which some players exhibit strategic substitutes and others exhibit strategic complements. For two-player games with linearly ordered strategy spaces, there is a characterization. More generally, there are sufficient conditions. The conditions apply only to players exhibiting strategic substitutes; no conditions are needed for players with strategic complements. Several examples highlight the results.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by University of Kansas, Department of Economics in its series WORKING PAPERS SERIES IN THEORETICAL AND APPLIED ECONOMICS with number 201240.
Length: 42 pages
Date of creation: Nov 2012
Date of revision: Nov 2012
Lattice games; strategic complements; strategic substitutes; strategic hetergeneity; equilibrium set; monotone comparative statics;
Find related papers by JEL classification:
- C70 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - General
- C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
This paper has been announced in the following NEP Reports:
- NEP-ALL-2012-12-06 (All new papers)
- NEP-COM-2012-12-06 (Industrial Competition)
- NEP-GTH-2012-12-06 (Game Theory)
- NEP-HPE-2012-12-06 (History & Philosophy of Economics)
- NEP-MIC-2012-12-06 (Microeconomics)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Vives, X., 1988.
"Nash Equilibrium With Strategic Complementarities,"
UFAE and IAE Working Papers
107-88, Unitat de Fonaments de l'Anàlisi Econòmica (UAB) and Institut d'Anàlisi Econòmica (CSIC).
- Tombak, Mihkel M., 2006. "Strategic asymmetry," Journal of Economic Behavior & Organization, Elsevier, vol. 61(3), pages 339-350, November.
- Roy, Sunanda & Sabarwal, Tarun, 2006.
"On the (non-)lattice structure of the equilibrium set in games with strategic substitutes,"
4120, University Library of Munich, Germany, revised 23 May 2007.
- Sunanda Roy & Tarun Sabarwal, 2008. "On the (non-)lattice structure of the equilibrium set in games with strategic substitutes," Economic Theory, Springer, vol. 37(1), pages 161-169, October.
- Alexander Zimper, 2005.
"A fixed point characterization of the dominancesolvability of lattice games with strategic substitutes,"
32, Economic Research Southern Africa.
- Alexander Zimper, 2007. "A fixed point characterization of the dominance-solvability of lattice games with strategic substitutes," International Journal of Game Theory, Springer, vol. 36(1), pages 107-117, September.
- Federico Echenique, 1999.
"Comparative Statics by Adaptative Dynamics and the Correspondence Principle,"
Documentos de Trabajo (working papers)
2099, Department of Economics - dECON.
- Federico Echenique, 2002. "Comparative Statics by Adaptive Dynamics and the Correspondence Principle," Econometrica, Econometric Society, vol. 70(2), pages 833-844, March.
- Federico Echenique, 2000. "Comparative Statics by Adaptive Dynamics and The Correspondence Principle," GE, Growth, Math methods 9912002, EconWPA.
- Federico Echenique., 2000. "Comparative Statics by Adaptive Dynamics and The Correspondence Principle," Economics Working Papers E00-273, University of California at Berkeley.
- Federico Echenique, 2000. "Comparative Statics by Adaptive Dynamics and The Correspondence Principle," Econometric Society World Congress 2000 Contributed Papers 1906, Econometric Society.
- Bulow, Jeremy I & Geanakoplos, John D & Klemperer, Paul D, 1985. "Multimarket Oligopoly: Strategic Substitutes and Complements," Journal of Political Economy, University of Chicago Press, vol. 93(3), pages 488-511, June.
- Amir, Rabah & Garcia, Filomena & Knauff, Malgorzata, 2010. "Symmetry-breaking in two-player games via strategic substitutes and diagonal nonconcavity: A synthesis," Journal of Economic Theory, Elsevier, vol. 145(5), pages 1968-1986, September.
- Acemoglu, Daron & Jensen, Martin Kaae, 2009. "Aggregate Comparative Statics," CEPR Discussion Papers 7254, C.E.P.R. Discussion Papers.
- Dixit, Avinash K, 1987. "Strategic Behavior in Contests," American Economic Review, American Economic Association, vol. 77(5), pages 891-98, December.
- Amir, Rabah, 1996.
"Cournot Oligopoly and the Theory of Supermodular Games,"
Games and Economic Behavior,
Elsevier, vol. 15(2), pages 132-148, August.
- AMIR, Rabah, 1994. "Cournot Oligopoly and the Theory of Supermodular Games," CORE Discussion Papers 1994013, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- John Quah & Bruno Strulovici, 2007.
"Comparative Statics, Informativeness, and the Interval Dominance Order,"
Economics Series Working Papers
2007-WO4, University of Oxford, Department of Economics.
- John K.-H. Quah & Bruno Strulovici, 2009. "Comparative Statics, Informativeness, and the Interval Dominance Order," Econometrica, Econometric Society, vol. 77(6), pages 1949-1992, November.
- John K.-H. Quah & Bruno Strulovici, 2007. "Comparative Statics, Informativeness, and the Interval Dominance Order," Economics Papers 2007-W04, Economics Group, Nuffield College, University of Oxford.
- Shannon, Chris, 1995. "Weak and Strong Monotone Comparative Statics," Economic Theory, Springer, vol. 5(2), pages 209-27, March.
- John K.-H Quah, 2007. "The Comparative Statics of Constrained Optimization Problems," Econometrica, Econometric Society, vol. 75(2), pages 401-431, 03.
- Aaron S. Edlin and Chris Shannon., 1995.
"Strict Monotonicity in Comparative Statics,"
Economics Working Papers
95-238, University of California at Berkeley.
- Gary S. Becker, 1974.
"Crime and Punishment: An Economic Approach,"
in: Essays in the Economics of Crime and Punishment, pages 1-54
National Bureau of Economic Research, Inc.
- Villas-Boas, J. Miguel, 1997. "Comparative Statics of Fixed Points," Journal of Economic Theory, Elsevier, vol. 73(1), pages 183-198, March.
- Milgrom, Paul & Roberts, John, 1990. "Rationalizability, Learning, and Equilibrium in Games with Strategic Complementarities," Econometrica, Econometric Society, vol. 58(6), pages 1255-77, November.
- Zhou Lin, 1994. "The Set of Nash Equilibria of a Supermodular Game Is a Complete Lattice," Games and Economic Behavior, Elsevier, vol. 7(2), pages 295-300, September.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Jianbo Zhang).
If references are entirely missing, you can add them using this form.