Intertemporal coordination with delay options

This paper studies equilibrium selection in intertemporal coordination problems with delay options. The risk-dominant action of the underlying one-shot game is selected when frictions are arbitrarily small. Larger frictions introduce real option effects in the model and inhibit coordination.

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Year of publication:	2015
Authors:	Araujo, Luis ; Guimaraes, Bernardo
Published in:	Journal of Economic Theory. - Elsevier, ISSN 0022-0531. - Vol. 157.2015, C, p. 793-810
Publisher:	Elsevier
Subject:	Intertemporal \| Coordination \| Delay options \| Overlapping generations

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Type of publication:	Article
Classification:	C73 - Stochastic and Dynamic Games ; D84 - Expectations; Speculations
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10011263612