Externalities in Economies with Endogenous Sharing Rules

Journal article: Endogenous sharing rules were introduced by Simon and Zame [16] to model payoff indeterminacy in discontinuous games. They prove the existence in every compact strategic game of a mixed Nash equilibrium and an associated sharing rule. We extend their result to economies with externalities [1] where, by definition, players are restricted to pure strategies. We also provide a new interpretation of payoff indeterminacy in Simon and Zame's model in terms of preference incompleteness.

Author(s)

Philippe Bich, Rida Laraki

Journal
  • Economic Theory Bulletin
Date of publication
  • 2017
Keywords JEL
C02 C62 C72 D50
Keywords
  • Incomplete and Discontinuous Preferences
  • Rasian Equilibrium
  • Wal
  • Better Reply Security
  • Economies
  • Generalized Games
  • Endogenous Sharing Rules
Pages
  • 127-137
Version
  • 1
Volume
  • 5