The Role of Mobility among Regions in Coordination
We investigate multiple regions in which coordination games are exclusively played by their participants. For every region, there exist a number of immobile individuals locked into this region. There also exist mobile individuals who look out for chances to move into more beneficial regions, but the ranges of regions into which they can move may be limited. All individuals intend to maximize their payoffs in a self-fulfilling way but they sometimes choose non-optimal strategies with a small probability. It is shown that when there exist sufficiently many individuals who are mobile in limited ways, all regions except the least productive region are well coordinated in the long-run of adjustment dynamics. This possibility result holds irrespective of how pessimistic individuals are. On the other hand, when the ranges of regions into which mobile individuals can move are expanded too much, all regions except the most productive region fall into coordination failure and the distributive inequality between immobile and mobile individuals increases very badly. Moreover, we argue that the policy interventions in the least productive region give the powerful spillover effect on facilitating coordination in the other regions.
|Date of creation:||Jun 1999|
|Date of revision:|
|Contact details of provider:|| Postal: Hongo 7-3-1, Bunkyo-ku, Tokyo 113-0033|
Web page: http://www.cirje.e.u-tokyo.ac.jp/index.html
More information through EDIRC
When requesting a correction, please mention this item's handle: RePEc:tky:fseres:99cf53. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (CIRJE administrative office)
If references are entirely missing, you can add them using this form.