Stability in games with continua of equilibria

Sebastian Bervoets and Mathieu Faure ()

Journal of Economic Theory, 2019, vol. 179, issue C, 131-162

Abstract: The stability of Nash equilibria has often been studied by examining the asymptotic behavior of the best-response dynamics. This is generally done in games where interactions are global and equilibria are isolated. In this paper, we analyze stability in contexts where interactions are local and where there are continua of equilibria. We focus on the public good game played on a network, where the set of equilibria is known to depend on the network structure (Bramoullé and Kranton, 2007), and where, as we show, continua of equilibria often appear. We provide necessary and sufficient conditions for a component of Nash equilibria to be asymptotically stable vis-à-vis the best-response dynamics. Interestingly, we demonstrate that these conditions relate to the structure of the network in a simple way. We also provide corresponding results for several dynamical systems related to the best response.

Keywords: Best-response dynamics; Public good games; Stability (search for similar items in EconPapers)
JEL-codes: C62 C73 D83 H41 (search for similar items in EconPapers)
Date: 2019
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (16)

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Working Paper: Stability in games with continua of equilibria (2019)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jetheo:v:179:y:2019:i:c:p:131-162

DOI: 10.1016/j.jet.2018.10.011

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