Pareto coordination game, Game Theory


Two corporations should simultaneously elect a technology to use for his or her compatible merchandise. If the corporations adopt totally different standards, few sales result. a {standard|a typical} standard ends up in higher sales. One technology is considerably most well-liked by customers over the opposite. Thus, if the businesses will standardize on the well-liked technology, every obtains maximal profits.


There are 2 pure strategy equilibria. Each corporations like identical equilibrium that Pareto dominates the opposite. A Mixed strategy equilibrium conjointly exists.


Firm 2



Firm 1







General Form

Player 2



Player 1







Where the following relations hold:
a>d>b; a>d>c 
w>z>y; w>z>x


Posted Date: 7/21/2012 4:40:00 AM | Location : United States

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