Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/94233
Authors: 
Carbonell-Nicolau, Oriol
McLean, Richard P.
Year of Publication: 
2012
Series/Report no.: 
Working Papers, Department of Economics, Rutgers, The State University of New Jersey 2012,07
Abstract: 
We show that supermodular games satisfying sequential better-reply security possess a pure strategy perfect equilibrium and a strategically stable set of pure strategies. We illustrate that, in continuous supermodular games, perfect equilibria may contain weakly dominated actions. Moreover, in discontinuous supermodular games, perfect equilibria may involve play of actions in the interior of the set of weakly dominated actions. We prove that when the set of undominated actions is a sublattice, supermodular games satisfying sequential better-reply security possess pure strategy perfect equilibria that can be obtained as limits of undominated actions.
Subjects: 
supermodular game
weakly dominated strategy
trembling-hand perfect equilibrium
strategically stable set
supermodular game
weakly dominated strategy
trembling-hand perfect equilibrium
strategically stable set
JEL: 
C72
Document Type: 
Working Paper

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