Coordination games with diverse sources of information

Venue: Room 418, School of Economics, Yuquan Campus

Speaker: Wolfgang Kuhle, senior research fellow, Max Planck Society

Abstract：

We study Bayesian coordination games where agents rely on diverse types of information: first, information over the game’s payoff coefficients. Second, information over the other players’ information. Third, information over the other players’ actions. For these different types of information, we characterize the equilibria that agents play. In particular, we study the information structures that ensure unique, respectively, multiple equilibria. Our results show that the traditional findings of the global games literature, Rubinstein (1989), Carlsson and van Damme (1993) and Morris and Shin (1998), which considers only information over payoffs, change substantially once agents can draw on diverse sources of information. In particular, the key global games result, namely that agents play unique equilibria when private information is very precise, reverses once agents draw on information over other players’actions.