The Chain Store Paradox.

Selten, R. (1978). The Chain Store Paradox. Theory and Decision, 9(2), 127-159.

Type

Journal article

Intellectual base

Primary research

Year

1978

DOI

10.1007/bf00131770

Link

https://doi.org/10.1007/BF00131770

Cited from

economics_finance

Cited by

4 citations across 3 artifacts.

Each citation links to the sentence it supports in the citing article.

Primes

• Credible Commitment
  • The entry-deterrence game is the canonical game-theoretic instance, and it shows credibility as the literal content of subgame-perfect equilibrium.

    This sourceThe canonical entry-deterrence analysis showing a bare fight-threat is not subgame-perfect (not credible) absent a commitment that alters execution-moment incentives.

• Shadow Of The Future
  • Critically, if the horizon is finite and commonly known, backward induction unravels cooperation from the last round forward, which is why an indefinite horizon (or observability carrying reputation to future partners) is structurally required.

    This sourceShows backward induction unravels cooperation in finitely repeated games with a commonly known last round, motivating the indefinite-horizon requirement.

Domain-specific

• Chainstore paradox
  • The paradox depends on complete information finite horizon and sequential rationality, reputation effects can reappear under incomplete information or bounded rationality and fighting can be credible in altered payoff or commitment structures.
  • … backward-induction subgame-perfect equilibrium, proposed deterrence reputation and its lack of credibility, incomplete-information resolution and distinction from commitment games are explicit. to An applied instance preserves the invariant under changed notation, scale, dataset, jurisdiction, or implementation..

Verification

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