Strategic substitutabilities versus strategic complementarities: Towards a general theory of expectational coordination?

Roger Guesnerie ()

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Abstract: This paper contrasts the views of expectational coordination in a stylised economic model under two polar assumptions: Strategic Complementarities (StCo) dominate or on the contrary are dominated by Strategic Substitutabilities (StSu). Although in the StCo case, "uniqueness" often "buys" "eductive stability", the two issues are strikingly different in the second case. Furthermore if, in the first case, incomplete information often improves "expectational coordination", it may have the converse effect in the StSu case. It is finally argued that, in macroeconomic contexts, StSu often unambiguously dominate StCo, even in a large class of models with Keynesian features, and even in an aggregate framework that magnifies the StCo effects. The "remains" of StCo in general cases are discussed.

Keywords: Strategic Complementarities (StCo); Strategic Substitutabilities (StSu) (search for similar items in EconPapers)
Date: 2005-03
Note: View the original document on HAL open archive server: https://shs.hal.science/halshs-00590856v1
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Citations: View citations in EconPapers (7)

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Related works:
Journal Article: Strategic Substitutabilities Versus Strategic Complementarities: Towards a General Theory of Expectational Coordination ? (2005)
Working Paper: Strategic Substitutabilities versus Strategic Complemenarities: Towards a General Theory of Expectational Coorination ? (2005)
Working Paper: Strategic substitutabilities versus strategic complementarities: Towards a general theory of expectational coordination? (2005)
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