Announcement wars as an equilibrium selection device.

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Working paper
Author/s: 
Nicola Acocella, Giovanni Di Bartolomeo, Andrew Hugues Hallett and Paolo G. Piaiacquadio
Issue number: 
2009/77
Publisher: 
Université catholique de Louvain
Year: 
2009
This paper attempts to give a rationale to public announcements, so often observed in the real world, and to formalize the idea that they can be used as a form of equilibrium selection device when multiple equilibria arise. It also shows how announcements solve the problems of coordination failures as predicted by the empirical literature based on experimental studies.
Developed by Paolo Gittoi