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Economic Policy in the Presence of Coordination Problems

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  • Russell W. Cooper

Abstract

This paper discusses the conduct of government policy in coordination games. In economic situations with multiple equilibria, government intervention may be valuable to overcome coordination problems and to internalize externalities. Yet, the design of optimal interventions is made more difficult by the presence of strategic complementarities and multiple equilibria.

Suggested Citation

  • Russell W. Cooper, 2005. "Economic Policy in the Presence of Coordination Problems," Revue d'économie politique, Dalloz, vol. 115(4), pages 379-390.
    • Handle: RePEc:cai:repdal:redp_154_0379
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    Cited by:

    1. Sarah Armitage & Noël Bakhtian & Adam Jaffe, 2024. "Innovation Market Failures and the Design of New Climate Policy Instruments," Environmental and Energy Policy and the Economy, University of Chicago Press, vol. 5(1), pages 4-48.
    2. Ünveren, Burak & Durmaz, Tunç & Sunal, Seçkin, 2023. "AI revolution and coordination failure: Theory and evidence," Journal of Macroeconomics, Elsevier, vol. 78(C).

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