STRUCTURAL ESTIMATION OF SEQUENTIAL GAMES OF COMPLETE INFORMATION. (18th December 2014)

• Record Type: Journal Article
• Authors: Blevins, Jason R.
• Is Part Of: Economic inquiry. Volume 53:Number 2(2015:Apr.)
• Page Start: 791
• Page End: 811
• Publication Date: 2014-12-18
• Subjects: Economics -- Periodicals; 330.05
• DOI: 10.1111/ecin.12189
• Languages: English
• ISSNs: 0095-2583

Abstract

<abstract abstract-type="main" id="ecin12189-abs-0001"> <title> <x xml:space="preserve">Abstract</x> </title> <p id="ecin12189-para-0001"> <italic>In models of strategic interaction, there may be important order of entry effects if one player can credibly commit to an action (e.g., entry) before other players. If one estimates a simultaneous‐move model, then the move‐order effects will be confounded with the payoffs. This article considers nonparametric identification and simulation‐based estimation of sequential games of complete information. Relative to simultaneous‐move games, these models avoid the problem of multiple equilibria and require fewer payoff normalizations. We apply the estimator in several Monte Carlo experiments and to study entry‐order effects using data from the airline industry</italic>. (<italic>JEL</italic> C57, C15, L93)</p> </abstract>