Equilibria in a Dynamic Global Game: The role of cohort effects

Paul Heidhues (heidhues@dice.hhu.de) and Nicolas Melissas

No 104, Royal Economic Society Annual Conference 2003 from Royal Economic Society

Abstract: We introduce strategic waiting in a global game setting. Players can wait in order to take a better informed decision. We allow for cohort effects, which naturally arise if the network externality in a given period depends on the mass of players who are actively using the technology at this point in time. Formally, cohort effects lead to intra-period network effects being greater than inter-period network effects. In the absence of cohort effects, our model has a unique rationalizable equilibrium. Cohort effects, however, can lead to multiple equilibria within the class of symmetric switching strategies.

Keywords: global game; strategic waiting; coordination; strategic complementarities; period-specific network effects (search for similar items in EconPapers)
JEL-codes: C72 C73 D82 D83 (search for similar items in EconPapers)
Date: 2003-06-04
New Economics Papers: this item is included in nep-gth and nep-net
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Citations: View citations in EconPapers (2)

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Related works:
Journal Article: Equilibria in a dynamic global game: the role of cohort effects (2006)
Working Paper: Equilibria in a Dynamic Global Game: The Role of Cohort Effects (2005)
Working Paper: Equilibria in a Dynamic Global Game: The Role of Cohort Effects (2003)
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