Endogenous timing game with non-monotonic reaction functions

Grégoire Rota-Graziosi () and Magnus Hoffmann
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Grégoire Rota-Graziosi: Centre d'Etudes et de Recherches sur le Développement International(CERDI)
Authors registered in the RePEc Author Service: Grégoire ROTA GRAZIOSI

No 201017, Working Papers from CERDI

Abstract: The aim of this paper is to generalize the endogenous timing game proposed by Hamilton and Slutsky (1990) to cases where the reaction functions are non-motononic, as for instance in the literature on contest. Following the taxonomy of social dilemma provided by Eaton (2004) we consider several pos- sible situations depending on the nature of interactions (plain complementarity or plain substituability and strategic complementarity or strategic substitutability). Under the assumptions of the existence and the uniqueness of the Nash and Stackelberg equilibria, we highlight the presence of a ?rst-mover advantage or a second-mover incentive only depending on the nature of cross-e?ects in players’ payo? functions and the slopes of their reaction functions at the Nash equilibrium of the static game. These properties allow us to determine rigorously the Subgame Perfect Nash Equilibrium (SPNE) in the ten studied situations. We establish under which conditions on the nature of interactions a leader emerges at the SPNE

Keywords: Endogenous timing game; ?rst-mover advantage; Second-mover incentive; Subgame Perfect Nash Equilibrium (search for similar items in EconPapers)
JEL-codes: C72 D43 L13 (search for similar items in EconPapers)
Pages: 19
Date: 2010
New Economics Papers: this item is included in nep-gth
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Citations: View citations in EconPapers (2)

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Related works:
Working Paper: Endogenous timing game with non-monotonic reaction functions (2011)
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