Games with Strategic Complements and Substitutes

Global Games Selection in Games with Strategic Substitutes or Complements

Global games methods are aimed at resolving issues of multiplicity of equilibria and coordination failure that arise in game theoretic models by relaxing common knowledge assumptions about an underlying parameter. These methods have recently received a lot of attention when the underlying complete information game is one of strategic complements (GSC). Little has been done in this direction con...

Cooperation in experimental games of strategic complements and substitutes

We conduct a laboratory experiment aimed at examining whether strategic substitutability and strategic complementarity have an impact on the tendency to cooperate in two-player games with a Paretoinefficient Nash equilibrium. We find that there is significantly more cooperation when actions exhibit strategic complementarities than in the case of strategic substitutes.

Strategic Commitment and Cooperation in Experimental Games of Strategic Complements and Substitutes *

We study the impact of strategic commitment on cooperation in indefinitely repeated games of strategic substitutes (Cournot) and complements (Bertrand) using laboratory experiments. Overall, strategic commitment has no effect on cooperation with strategic substitutes and a negative one with strategic complements. In the absence of strong strategic commitment, we find more cooperation in the com...

Information complements, substitutes, and strategic product design

Strategic Substitutes and Potential Games

We show that games of strategic substitutes (or complements) with aggregation are “pseudo-potential” games, and therefore possess Nash equilibria in pure strategies. Our notion of aggregation is quite general and enables us to take a unified view of several disparate models. JEL Classification Numbers: C 72, D 43, L 13.