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Article
Partial Bandwagon Effects and Local Interactions
Games and Economic Behavior (2007)
  • Carlos Alós-Ferrer, University of Konstanz
  • Simon Weidenholzer, University of Vienna
Abstract

We consider partial bandwagon properties in the context of coordination games to capture the idea of weak network externalities. We then study a local interactions model where agents play a coordination game following a noisy best-reply process. We identify conditions such that Globally Pairwise Risk Dominant strategies are selected. Examples include arbitrary 3 X 3 coordination games and n X n supermodular games. A comparison with the global interactions benchmark shows that the nature of interactions might alter the long-run results themselves, and not only the speed of convergence. We also illustrate that the simultaneous coexistence of conventions is possible for games with at least 5 strategies.

Keywords
  • Learning,
  • Networks,
  • Partial Bandwagon Properties,
  • Pairwise Risk Dominance
Disciplines
Publication Date
2007
Citation Information
Carlos Alós-Ferrer and Simon Weidenholzer. "Partial Bandwagon Effects and Local Interactions" Games and Economic Behavior Vol. 61 Iss. 2 (2007)
Available at: http://works.bepress.com/alos/9/