Abstract
We show that supermodular games satisfying sequential better-reply security possess a pure strategy perfect equilibrium and a strategically stable set of pure strategy equilibria. We illustrate that in continuous supermodular games, perfect equilibria may contain weakly dominated actions. Moreover, in discontinuous supermodular games satisfying sequential better-reply security, perfect equilibria may involve play of actions in the interior of the set of weakly dominated actions. We show that supermodular games satisfying sequential better-reply security possess pure strategy perfect equilibria outside the interior of the set of weakly dominated action profiles.
Original language | English (US) |
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Pages (from-to) | 869-890 |
Number of pages | 22 |
Journal | International Journal of Game Theory |
Volume | 44 |
Issue number | 4 |
DOIs | |
State | Published - Nov 1 2015 |
All Science Journal Classification (ASJC) codes
- Statistics and Probability
- Mathematics (miscellaneous)
- Social Sciences (miscellaneous)
- Economics and Econometrics
- Statistics, Probability and Uncertainty
Keywords
- Perfect equilibrium
- Strategically stable set
- Supermodular game
- Weakly dominated strategy