Stability and equilibrium selection in a link formation game

Rodrigo Harrison, Roberto Muñoz

Research output: Contribution to journalArticlepeer-review

6 Scopus citations


In this paper we study a static link formation game under consent that has multiple Nash equilibria. In the literature, the use of coalitional refinements has been the standard approach to select among equilibria. Alternatively, based on the Global Games theory, a non cooperative equilibrium selection approach is proposed, so as to select those Nash equilibria that are robust to the introduction of incomplete information. Interestingly, the equilibrium selected is unique and it is in conflict with those predicted by the commonly used coalitional refinements. Furthermore, a conflict is found between stability and efficiency even when no such conflict exists with the coalitional refinements.

Original languageEnglish
Pages (from-to)335-345
Number of pages11
JournalEconomic Theory
Issue number2
StatePublished - Nov 2008
Externally publishedYes


  • Equilibrium selection
  • Global games
  • Networks


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