Journal or Book Title
Journal of Economic Theory
First Page or Article ID Number
We study games with strategic complementarities, arbitrary numbers of players and actions, and slightly noisy payoff signals. We prove limit uniqueness: as the signal noise vanishes, the game has a unique strategy profile that survives iterative dominance. This generalizes a result of Carlsson and van Damme (Econometrica 61 (1993) 989–1018) for two-player, two-action games. The surviving profile, however, may depend on fine details of the structure of the noise. We provide sufficient conditions on payoffs for there to be noise-independent selection.
Frankel, David M.; Morris, Stephen; and Pauzner, Ady, "Equilibrium Selection in Global Games with Strategic Complementarities" (2003). Economics Publications. 98.