On the relationship between robustness to incomplete information and noise-independent selection in global games

Daisuke Oyama and Satoru Takahashi

Journal of Mathematical Economics, 2011, vol. 47, issue 6, 683-688

Abstract: This note demonstrates that a symmetric 3×3 supermodular game may fail to have any equilibrium robust to incomplete information. Since the global game solution in symmetric 3×3 supermodular games is known to be independent of the noise structure, this result implies that a noise-independent selection in global games may not be a robust equilibrium. Our proof reveals that the assumption in global games that the noise errors are independent of the state imposes a non-trivial restriction on incomplete information perturbations.

Keywords: Equilibrium selection; Supermodular game; Incomplete information; Robustness; Contagion; Global game (search for similar items in EconPapers)
Date: 2011
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Citations: View citations in EconPapers (19)

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Related works:
Working Paper: On the Relationship between Robustness to Incomplete Information and Noise-Independent Selection in Global Games (2011)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:mateco:v:47:y:2011:i:6:p:683-688

DOI: 10.1016/j.jmateco.2011.09.001

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