Stability and equilibrium selection in a link formation game (Q946367)

The referred paper contributes to the non-cooperative approach to the link formation game model and analysis. It is based on the global games theory, and its fundamental object of interest is the characteristics of the Nash equilibrium of such game. The main goal of the analysis is to select Nash equilibria which are robust to the incompleteness of information. It is shown by the main result of the paper that there exists exactly one such equilibrium. Its stability property is confronted with the stability of the Nash equilibria derived by an alternative (namely, cooperative) approach.