Information, Coordination, and the Industrialization of Countries

Florian Englmaier and Markus Reisinger

No 1670, CESifo Working Paper Series from CESifo

Abstract: The industrialization process of a country is often plagued by a failure to coordinate investment decisions. Using the Global Games approach we can solve this coordination problem and eliminate the problem of multiple equilibria. We show how appropriate information provision enhances efficiency. We discuss extensions of the model and argue that subsidies may be a property of a signalling equilibrium to overcome credibility problems in information provision. In addition we point out possible problems with overreaction to public information. Furthermore, we suggest a new focus for development policy.

Keywords: information; coordination; industrialization; development; global games; equilibrium refinements; big push (search for similar items in EconPapers)
JEL-codes: C72 C79 D82 F21 O12 O14 (search for similar items in EconPapers)
Date: 2006
New Economics Papers: this item is included in nep-dev
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Related works:
Journal Article: Information, Coordination and the Industrialization of Countries (2008)
Working Paper: Information, coordination and the industrialization of countries (2008)
Working Paper: Information, Coordination, and the Industrialization of Countries (2006)
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Persistent link: https://EconPapers.repec.org/RePEc:ces:ceswps:_1670

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