This file is part of IDEAS, which uses RePEc data


[ Papers | Articles | Software | Books | Chapters | Authors | Institutions | JEL Classification | NEP reports | Search | New papers by email | Author registration | Rankings | Volunteers | FAQ | Blog | Help! ]

An Approach to Equilibrium Selection

Author info | Abstract | Publisher info | Download info | Related research | Statistics
Author Info
Akihiko Matsui
Kiminori Matsuyama

Additional information is available for the following registered author(s):

Abstract

We consider equilibrium selection in 2x2 bimatrix games with two strict Nash equilibria in a random matching framework. The players seek to maximize the discounted payoffs, but are restricted to make a short run commitment. Modeling the friction this way yields equilibrium dynamics of the behavior patters in the society. We define and characterize an absorbing and globally attractive state in this dynamics. It is shown that, as friction becomes arbitrarily small, a strict Nash equilibrium outcome becomes unique absorbing and globally attractive if and only if it satisfies the Harsanyi/Selton notion of risk-dominance criterion.

Download Info
To download:

If you experience problems downloading a file, check if you have the proper application to view it first. Information about this may be contained in the File-Format links below. In case of further problems read the IDEAS help file. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://www.kellogg.northwestern.edu/research/math/papers/970.pdf
File Format: application/pdf
File Function: main text
Download Restriction: no

Publisher Info
Paper provided by Northwestern University, Center for Mathematical Studies in Economics and Management Science in its series Discussion Papers with number 970.

Download reference. The following formats are available: HTML, plain text, BibTeX, RIS (EndNote), ReDIF
Length:
Date of creation: Nov 1990
Date of revision:
Handle: RePEc:nwu:cmsems:970

Contact details of provider:
Postal: Center for Mathematical Studies in Economics and Management Science, Northwestern University, 580 Jacobs Center, 2001 Sheridan Road, Evanston, IL 60208-2014
Phone: 847/491-3527
Fax: 847/491-2530
Email:
Web page: http://www.kellogg.northwestern.edu/research/math/
More information through EDIRC

Order Information:
Email:

For technical questions regarding this item, or to correct its listing, contact: (Fran Walker).

Related research
Keywords: Equilibrim Selection Random Matching Games risk-dominance

Other versions of this item:

Find related papers by JEL classification:
C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games

References listed on IDEAS
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.:

  1. Matsuyama, Kiminori, 1992. "A Simple Model of Sectoral Adjustment," Review of Economic Studies, Blackwell Publishing, vol. 59(2), pages 375-88, April. [Downloadable!] (restricted)
  2. Milgrom, Paul & Roberts, John, 1990. "Rationalizability, Learning, and Equilibrium in Games with Strategic Complementarities," Econometrica, Econometric Society, vol. 58(6), pages 1255-77, November. [Downloadable!] (restricted)
  3. Fudenberg, D. & Harris, C., 1992. "Evolutionary dynamics with aggregate shocks," Journal of Economic Theory, Elsevier, vol. 57(2), pages 420-441, August. [Downloadable!] (restricted)
    Other versions:
  4. Joseph Farrell & Garth Saloner, 1985. "Standardization, Compatibility, and Innovation," RAND Journal of Economics, The RAND Corporation, vol. 16(1), pages 70-83, Spring. [Downloadable!] (restricted)
    Other versions:
  5. Carlsson, H. & Van Damme, E., 1989. "Global Payoff Uncertainty And Risk Dominance," Papers 8933, Tilburg - Center for Economic Research.
  6. David Canning, 1989. "Convergence to Equilibrium in a Sequence for Games with Learning," STICERD - Theoretical Economics Paper Series 190, Suntory and Toyota International Centres for Economics and Related Disciplines, LSE.
  7. Ellison, Glenn, 1993. "Learning, Local Interaction, and Coordination," Econometrica, Econometric Society, vol. 61(5), pages 1047-71, September. [Downloadable!] (restricted)
  8. Matsuyama Kiminori, 1991. "Increasing Returns, Industrialization, and Indeterminacy of Equilibrium," NBER Reprints 1626, National Bureau of Economic Research, Inc.
    Other versions:
  9. Murphy, Kevin M & Shleifer, Andrei & Vishny, Robert W, 1989. "Industrialization and the Big Push," Journal of Political Economy, University of Chicago Press, vol. 97(5), pages 1003-26, October. [Downloadable!] (restricted)
    Other versions:
  10. Friedman, Daniel, 1991. "Evolutionary Games in Economics," Econometrica, Econometric Society, vol. 59(3), pages 637-66, May. [Downloadable!] (restricted)
  11. Boylan, Richard T., 1990. "Laws of Large Numbers for Dynamical Systems with Randomly Matched Individuals," Working Papers 748, California Institute of Technology, Division of the Humanities and Social Sciences. [Downloadable!]
  12. Swinkels Jeroen M., 1993. "Adjustment Dynamics and Rational Play in Games," Games and Economic Behavior, Elsevier, vol. 5(3), pages 455-484, July. [Downloadable!] (restricted)
    Other versions:
  13. Kalai, Ehud & Lehrer, Ehud, 1991. "Rational Learning Leads to Nash Equilibrium," Working Papers 91-18, C.V. Starr Center for Applied Economics, New York University. [Downloadable!]
    Other versions:
  14. Diamond, Douglas W & Dybvig, Philip H, 1983. "Bank Runs, Deposit Insurance, and Liquidity," Journal of Political Economy, University of Chicago Press, vol. 91(3), pages 401-19, June. [Downloadable!] (restricted)
    Other versions:
  15. Young, H Peyton, 1993. "The Evolution of Conventions," Econometrica, Econometric Society, vol. 61(1), pages 57-84, January. [Downloadable!] (restricted)
  16. Matsui, Akihiko, 1992. "Best response dynamics and socially stable strategies," Journal of Economic Theory, Elsevier, vol. 57(2), pages 343-362, August. [Downloadable!] (restricted)
  17. Akihiko Matsui, 1989. "Cheap Talk and Cooperation in the Society," Discussion Papers 848, Northwestern University, Center for Mathematical Studies in Economics and Management Science. [Downloadable!]
  18. Cooper, Russell & John, Andrew, 1988. "Coordinating Coordination Failures in Keynesian Models," The Quarterly Journal of Economics, MIT Press, vol. 103(3), pages 441-63, August. [Downloadable!] (restricted)
  19. Matsui, Akihiko, 1991. "Cheap-talk and cooperation in a society," Journal of Economic Theory, Elsevier, vol. 54(2), pages 245-258, August. [Downloadable!] (restricted)
  20. Boylan, Richard T., 1992. "Laws of large numbers for dynamical systems with randomly matched individuals," Journal of Economic Theory, Elsevier, vol. 57(2), pages 473-504, August. [Downloadable!] (restricted)
  21. Itzhak Gilboa & Akihiko Matsui, 1990. "A Model of Random Matching," Discussion Papers 887, Northwestern University, Center for Mathematical Studies in Economics and Management Science. [Downloadable!]
    Other versions:
  22. Kohlberg, Elon & Mertens, Jean-Francois, 1986. "On the Strategic Stability of Equilibria," Econometrica, Econometric Society, vol. 54(5), pages 1003-37, September. [Downloadable!] (restricted)
  23. Kiminori Matsuyama, 1991. "Custom Versus Fashion: Hysteresis and Limit Cycles in a Random Matching Game," Discussion Papers 940, Northwestern University, Center for Mathematical Studies in Economics and Management Science. [Downloadable!]
  24. Krugman, Paul, 1991. "Increasing Returns and Economic Geography," Journal of Political Economy, University of Chicago Press, vol. 99(3), pages 483-99, June. [Downloadable!] (restricted)
    Other versions:
  25. Boylan, Richard., 1990. "Equilibria Resistant to Mutation," Working Papers 729, California Institute of Technology, Division of the Humanities and Social Sciences. [Downloadable!]
  26. Gilboa, Itzhak & Matsui, Akihiko, 1991. "Social Stability and Equilibrium," Econometrica, Econometric Society, vol. 59(3), pages 859-67, May. [Downloadable!] (restricted)
Full references

Cited by:
(explanations, 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.)

  1. repec:att:wimass:19199923 is not listed on IDEAS
  2. Daisuke Oyama & Satoru Takahashi & Josef Hofbauer, 2003. "Monotone Methods for Equilibrium Selection under Perfect Foresight Dynamics," Levine's Bibliography 666156000000000420, UCLA Department of Economics. [Downloadable!]
    Other versions:
  3. Stephen Morris & Hyun Song Shin, 2000. "Global Games: Theory and Applications," Cowles Foundation Discussion Papers 1275R, Cowles Foundation, Yale University, revised Aug 2001. [Downloadable!]
    Other versions:
  4. Akihiko Matsui & Daisuke Oyama, 2002. "Rationalizable Foresight Dynamics: Evolution and Rationalizability," Vienna Economics Papers 0302, University of Vienna, Department of Economics. [Downloadable!]
  5. Huberto Ennis & Todd Keister, 2001. "Optimal policy with probabilistic equilibrium selection," Working Paper 01-03, Federal Reserve Bank of Richmond. [Downloadable!]
  6. Lawrence E. Blume, 2003. "Stigma and Social Control," Game Theory and Information 0312002, EconWPA. [Downloadable!]
    Other versions:
  7. Kiminori Matsuyama, 1999. "Playing Multiple Complementarity Games Simultaneously," Discussion Papers 1240, Northwestern University, Center for Mathematical Studies in Economics and Management Science. [Downloadable!]
  8. Angelo Antoci & Massimiliano Landi & Pier Luigi Sacco, 2006. "Expectations, Animal Spirits, and Evolutionary Dynamics," Working Papers 10-2006, Singapore Management University, School of Economics. [Downloadable!]
  9. Shirley HO, 2004. "Evolutionary Forces in a Banking System with Speculation and System Risk," Econometric Society 2004 Far Eastern Meetings 692, Econometric Society. [Downloadable!]
  10. Oyama, Daisuke & Tercieux, Olivier, 2004. "Iterated Potential and Robustness of Equilibria," MPRA Paper 1599, University Library of Munich, Germany. [Downloadable!]
  11. David M. Frankel & Stephen Morris & Ady Pauzner, 2001. "Equilibrium Selection in Global Games with Strategic Complementarities," Cowles Foundation Discussion Papers 1336, Cowles Foundation, Yale University. [Downloadable!]
    Other versions:
  12. Huberto M. Ennis, 2003. "Economic fundamentals and bank runs," Economic Quarterly, Federal Reserve Bank of Richmond, issue Spr, pages 55-71. [Downloadable!]
  13. Carlos Alós-Ferrer, 1998. "- Dynamical Systems With A Continuum Of Randomly Matched Agents," Working Papers. Serie AD 1998-08, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie). [Downloadable!]
    Other versions:
  14. Kiminori Matsuyama, 1996. "Why Are There Rich and Poor Countries?: Symmetry-Breaking in the World Economy," NBER Working Papers 5697, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
    Other versions:
Statistics
Access and download statistics

Did you know? Springer Verlag was the first commercial publisher to be listed on RePEc.

This page was last updated on 2008-7-29.

This information is provided to you by IDEAS at the Department of Economics, College of Liberal Arts and Sciences, University of Connecticut using RePEc data on a server sponsored by the Society for Economic Dynamics.