Abstract/Details

Essays on coordination problems


2006 2006

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Abstract (summary)

Coordination cycles. We build a dynamic global game in which players repeatedly face a similar coordination problem. By choosing a risky action (invest) instead of an outside option (not invest), players risk instantaneous losses as well as payoffs from future stages, in which they cannot participate if they go bankrupt. Thus, the total strategic risk associated with investment in a particular stage depends on the expected continuation payoff. High expected future payoffs make investment today more risky and therefore harder to coordinate on, which decreases today's payoff. Expectation of successful coordination tomorrow undermines successful coordination today which leads to fluctuations of equilibrium behavior even if the underlying economic fundamentals happen to be stationary. The dynamic game inherits the equilibrium uniqueness of static global games.

Coordination in a mobile world. We study coordination failures in many simultaneously occurring coordination problems called projects. Players encounter one of these projects, but have an outside option to search for another of the projects. Drawing on the global games approach, we show that such a \emph{mobile} game has a unique equilibrium which allows us to examine comparative statics. The endogeneity of the outside option value and of the search activity leads to non-monotonicity of welfare with respect to search costs; high mobility may hurt players. Moreover, outcomes of the mobile game are remarkably robust to changes in the exogenous parameters. In contrast to the "static" benchmark global game without a search option, successful coordination is frequent in the mobile game even for extremely poor distributions of economic fundamentals, and coordination failures are common even for extremely good distributions. The strategic consequences of the search option are robust to various modifications of the model.

Strong enforcement by a weak authority. This paper studies enforcement abilities of authorities with limited commitment to punish violators. Commitment of resources sufficing to punish only one agent is needed to enforce high compliance of arbitrary many agents. Though existence of other, non-compliance equilibria is generally inevitable, there exist punishment rules suitable for limited authority assuring that compliance prevails in the long run under a stochastic evolution.

Indexing (details)


Subject
Economic theory;
Essays;
Coordination;
Globalization;
Enforcement;
Compliance;
Studies
Classification
0511: Economic theory
Identifier / keyword
Social sciences; Coordination problems; Game theory; Global games; Microeconomics
Title
Essays on coordination problems
Author
Steiner, Jakub
Number of pages
86
Publication year
2006
Degree date
2006
School code
1486
Source
DAI-A 67/03, Dissertation Abstracts International
Place of publication
Ann Arbor
Country of publication
United States
ISBN
9780542614897, 0542614898
Advisor
Shaked, Avner
University/institution
Univerzita Karlova (Czech Republic)
University location
Czech Republic
Degree
Ph.D.
Source type
Dissertations & Theses
Language
English
Document type
Dissertation/Thesis
Dissertation/thesis number
3212504
ProQuest document ID
304914643
Copyright
Database copyright ProQuest LLC; ProQuest does not claim copyright in the individual underlying works.
Document URL
http://search.proquest.com/docview/304914643
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