We study a dynamic coordination problem with staggered decisions where agents choose between two competing networks. If the intrinsically worst one prevails, this is efficient. Moreover, inefficient shifts to the intrinsically best network might occur in equilibrium.
Bibliographical noteFunding Information:
We thank Luis Araujo, Braz Camargo, Itay Goldstein, Caio Machado, Daniel Monte, Jakub Steiner, the editor Alessandro Pavan and two anonymous referees for invaluable comments. Bernardo Guimaraes gratefully acknowledges financial support from CNPq . Ana Elisa Pereira gratefully acknowledges financial support from the Sao Paulo Research Foundation ( FAPESP ) through grants 2013/24368-7 and 2014/06069-5 .
© 2016 Elsevier Inc..
- Dynamic games
- Timing frictions