Existence of equilibrium in common agency games with adverse selection

Guilherme Carmona and José Fajardo ()

Games and Economic Behavior, 2009, vol. 66, issue 2, 749-760

Abstract: We establish the existence of subgame perfect equilibria in general menu games, known to be sufficient to analyze common agency problems. Our main result states that every menu game satisfying enough continuity properties has a subgame perfect equilibrium. Despite the continuity assumptions that we make, discontinuities naturally arise due to the absence, in general, of continuous optimal choices for the agent. Our approach, then, is based on (and generalizes) the existence theorem of [Simon, L., Zame, W., 1990. Discontinuous games and endogenous sharing rules. Econometrica 58 (4), 861-872] designed for discontinuous games.

Keywords: Common; agency; Menu; games; Subgame; perfect; equilibrium (search for similar items in EconPapers)
Date: 2009
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (26)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0899-8256(08)00184-X
Full text for ScienceDirect subscribers only

Related works:
Working Paper: Existence of Equilibrium in Common Agency Games with Adverse Selection (2006)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:gamebe:v:66:y:2009:i:2:p:749-760

Access Statistics for this article

Games and Economic Behavior is currently edited by E. Kalai

More articles in Games and Economic Behavior from Elsevier
Bibliographic data for series maintained by Catherine Liu ().