Journal of Economics

, Volume 97, Issue 3, pp 265–272 | Cite as

Payoff dominance and risk dominance in the observable delay game: a note

  • Toshihiro Matsumura
  • Akira OgawaEmail author


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.


Observable delay Endogenous role Payoff dominance Risk dominance 

JEL Classification

L13 C72 


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Copyright information

© Springer-Verlag 2009

Authors and Affiliations

  1. 1.Institute of Social ScienceUniversity of TokyoTokyoJapan
  2. 2.College of Liberal ArtsInternational Christian UniversityMitaka, TokyoJapan

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