Equilibria in a dynamic global game: the role of cohort effects

B-Tier
Journal: Economic Theory
Year: 2006
Volume: 28
Issue: 3
Pages: 531-557

Score contribution per author:

1.005 = (α=2.01 / 2 authors) × 1.0x B-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

We introduce strategic waiting in a global game setting with irreversible investment. Players can wait in order to make a better informed decision. We allow for cohort effects, which arise endogenously in technology adoption problems with positive contemporaneous network effects. Formally, cohort effects lead to intra-period network effects being greater than inter-period network effects. Depending on the nature of the cohort effects, our game may or may not satisfy dynamic increasing differences. If it does, our model has a unique rationalizable outcome. Otherwise, multiple equilibria may exist as players want to invest at the same point in time others do. Copyright Springer-Verlag Berlin/Heidelberg 2006

Technical Details

RePEc Handle
repec:spr:joecth:v:28:y:2006:i:3:p:531-557
Journal Field
Theory
Author Count
2
Added to Database
2026-01-26