OGAWA, Akira    Associate Professor    Division of Arts and Sciences, College of Liberal Arts, International Christian University
Language	English
Publication Date	2009/07
Type	Research Paper (Scientific Journal)
Title	Payoff Dominance and Risk Dominance in the Observable Delay Game: A Note
Contribution Type	Joint Work
Journal	Journal of Economics
Volume, Issue, Pages	97(3),pp.265-272
Author and coauthor	OGAWA, Akira, Toshihiro Matsumura
Details	We examine whether the payoff dominant sequential-move (Stackelberg) outcome is realized when timing is endogenized. We adopt the observable delay game formulated by Hamilton and Slutsky [Games Econ Behav 2(1):29–46, 1990]. We find that if one sequential-move outcome is payoff dominant, either (i) the outcome both players prefer is the unique equilibrium; or (ii) two sequential-move outcomes are equilibria and the one both players prefer is risk dominant. In other words, no conflict between payoff dominance and risk dominance in the observable delay game exists, in contrast to other games such as (non pure) coordination games. We also find that even if one of two sequential-move outcomes is the unique equilibrium outcome in the observable delay game, it does not imply that the equilibrium outcome is payoff dominant to the other sequential-move outcome.
DOI	10.1007/s00712-009-0065-z