Monotone Comparative Statics for Games With Strategic Substitutes

Sunanda Roy and Tarun Sabarwal

Staff General Research Papers Archive from Iowa State University, Department of Economics

Abstract: Under some conditions, parameterized games with strategic substitutes exhibit monotone comparative statics of equilibria. These conditions relate to a tradeoff between a direct parameter effect and an opposing, indirect strategic substitute effect. If the indirect effect does not dominate the direct effect, monotone comparative statics of equilibria are guaranteed. These conditions are available for best-response functions, differentiable payoff functions, and general payoff functions. Results are extended to correspondences, the analysis applies to asymmetric equilibria, and several examples are provided.

Keywords: monotone comparative statics; non-increasing functions; strategic substitutes; parameterized games (search for similar items in EconPapers)
JEL-codes: C62 C70 C72 (search for similar items in EconPapers)
Date: 2009-01-28
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Published in Journal of Mathematical Economics 2010, vol. 46 no. 5

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Related works:
Journal Article: Monotone comparative statics for games with strategic substitutes (2010)
Working Paper: Monotone Comparative Statics for Games With Strategic Substitutes (2010)
Working Paper: Monotone Comparative Statics for Games with Strategic Substitutes (2007)
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Persistent link: https://EconPapers.repec.org/RePEc:isu:genres:31558

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