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Strongly Coalition-Proof Equilibria in Games with Strategic Complementarities

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  • Paul Milgrom
  • John Roberts

Abstract

We identify two sufficient conditions for games with strategic complementarities to have a unique equilibrium that is "strongly coalition-proof," that is, immune to incentive-compatible deviations by coalitions. If a Nash equilibrium is unique, then it is strongly coalition-proof. Also, if each player's payoff is increasing (respectively, decreasing) in the other players' strategies, then the maximum (respectively, minimal) equilibrium is the unique strongly coalition-proof equilibrium. We offer several applications of these results, including one to the contracting model of Hart and Moore.

Suggested Citation

  • Paul Milgrom & John Roberts, "undated". "Strongly Coalition-Proof Equilibria in Games with Strategic Complementarities," Working Papers 95002, Stanford University, Department of Economics.
    • Handle: RePEc:wop:stanec:95002
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    References listed on IDEAS

    as
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    5. Bernheim, B. Douglas & Peleg, Bezalel & Whinston, Michael D., 1987. "Coalition-Proof Nash Equilibria I. Concepts," Journal of Economic Theory, Elsevier, vol. 42(1), pages 1-12, June.
    6. 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.
    7. Milgrom, Paul & Roberts, John, 1994. "Comparing Equilibria," American Economic Review, American Economic Association, vol. 84(3), pages 441-459, June.
    8. Milgrom, Paul & Roberts, John, 1990. "Rationalizability, Learning, and Equilibrium in Games with Strategic Complementarities," Econometrica, Econometric Society, vol. 58(6), pages 1255-1277, November.
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