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Alesina Drazen (1991) - Why Are Stabilizations Delayed (view source)
Revision as of 22:33, 25 May 2010
, 22:33, 25 May 2010no edit summary
Proposition 1 states that there exists a symmetric Nash equilbirum with each group's concession function described by <math>T(\theta)\,</math> where <math>T(\theta)\,</math> is implicitly defined by:
:<math>\underbrace{\underbrace{\left(-\frac{f(\theta)}{F(\theta)}\frac{1}{t'(\theta)}\right)}{\mbox{conditional probability that opponent concedes}}\underbrace{\frac{2 \alpha -1}{r}}{\mbox{gain if opponent concedes}}}{\mbox{benefit of waiting another instant to concede}}= \underbrace{\gamma (\theta + \frac{1}{2} - \alpha)}{\mbox{cost of waiting another instant to concede}}\,</math>
