Global Game Research Articles

Equilibrium Existence in Global Games with General Payoff Structures

We consider global games with general payoff structures and prove existence of equilibrium. This shows that the global games method is well-defined with arbitrary strategic interaction among players, thus providing a foundation for the study of more general equilibrium behavior, especially as research in global games moves beyond the case of strategic complements. We also show that in every global game, even though the information of each player is correlated, the joint information measure is absolutely continuous with respect to the product of its marginals. As one application, the result here can be used to show existence of equilibrium in global games with both complementarity and congestion. This proves existence of equilibrium in a finite-player version of the model in Karp, Lee, and Mason (2007), thus addressing a gap in the proof of equilibrium existence documented in Hoffmann and Sabarwal (2015).

Book Review: Gulshan Dietl (2017). India and the Global Game of Gas Pipelines

Book Review: Gulshan Dietl (2017). <i>India and the Global Game of Gas Pipelines</i>

Determinants of growth and decline in mobile game diffusion

Rapidly advancing mobile technology has made mobile games a leader in the global games market. As the market size of mobile games has grown, the competition has also accelerated enormously. Thus, in order to ensure success, mobile games must sustain their initial boom for a long time, as well as attract enough users to solidify their installed base. The purpose of this research is to detect diffusion patterns and identify the determinants of mobile games' growth and decline hazards. The results show that mobile games have a distinctive brand-level life cycle in which the growth possibility decreases monotonically over time after the release, while the decline possibility rises after reaching the peak and then later begins to fall. This paper shows how the games' characteristics affect their attracting/holding power. The study provides implications for developers and distributors in terms of how to design, market, and manage mobile games.

The Global Game: Commodifying the Playground at the End of the Empire

Postmodernity has seen the space of children’s play increasingly locked into local and global economies. This essay argues that the new Margaret Mahy Family Playground built in Christchurch, New Zealand after a series of destructive earthquakes has not only become an expensive market-driven commodity, but has also been expected to mediate between a virtually empty inner city and its anticipated recovery. While the original design by children sought to incorporate aspects of Mahy’s legacy, the eventual shape of the playground resembled other playgrounds elsewhere. Various interventions are examined which sought to minimize this ubiquitous quality, including the role played by local Maori tribe, Ngāi Tahu.

Some Evidence of 'Publicity Multipliers' in Initial Public Offerings (IPOs)

We develop a theory of speculative bidding to explain why IPOs are persistently underpriced. Using the global games framework, we show IPO offer prices act as a coordination mechanism which causes rational investors to overreact to offer price revisions. Empirical tests show the magnitude of market overreactions increases when investors acquire information in anticipation of the IPO, suggesting that IPO underpricing is an inevitable consequence of the book build mechanism. An unfortunate corollary is that underwriters' attempts to price efficiently inadvertently increase the effectiveness of price revisions as a coordination mechanism, leading to persistent underpricing.

Rationalization and identification of binary games with correlated types

This paper studies the rationalization and identification of binary games where players have correlated private types. Allowing for type correlation is crucial in global games and in models with social interactions as it represents correlated private information and homophily, respectively. Our approach is fully nonparametric in the joint distribution of types and the strategic effects in the payoffs. First, under monotone pure Bayesian Nash Equilibrium strategy, we characterize all the restrictions if any on the distribution of players’ choices imposed by the game-theoretic model as well as restrictions associated with two assumptions frequently made in the empirical analysis of discrete games. Namely, we consider exogeneity of payoff shifters relative to private information, and mutual independence of private information given payoff shifters. Second, we study the nonparametric identification of the payoff functions and types distribution. We show that the model with exogenous payoff shifters is fully identified up to a single location-scale normalization under some exclusion restrictions and rank conditions. Third, we discuss partial identification under weaker conditions and multiple equilibria. Lastly, we briefly point out the implications of our results for model testing and estimation.

The cost of capital in a model of financial intermediation with coordination frictions

This paper studies the impact of coordination frictions in financial markets on the cost of capital of real sector projects. In the model, a financial intermediary seeks to raise funds from many small investors, to finance a capital-intensive project. Investors face a coordination problem, as more capital invested in the project increases its chances of success. We employ a global games refinement to characterize the unique equilibrium of the game. The model features a non-monotonic relationship between the cost of capital and project profitability. There exists a ‘socially optimal’ price of capital that maximizes the probability of project success. However, fee-maximizing intermediaries set a return that is higher than the optimal rate. This higher cost of capital is the result of coordination frictions and suggests an inefficiency of the intermediation process. The model best characterizes project finance investments funded through bond markets and yields implications for their cost of capital.

Paradox and the gift of an indestructible ball: a case study of the One World Futbol Project

The One World Futbol Project produces and sells an ultra-durable soccer ball that can be used in the harshest of environments. This case study provides a close examination of how the organization addresses paradox specifically within the context of sport-related interventions in underserved communities. The organization confronts the existing paradoxes of equipping and promoting soccer as the global game. But also contends with two paradoxes it introduces: the product as a technological fix and doing good while making a profit. An analysis of promotional videos, news segments and TEDx Talks reveals that the organization effectively manages the tensions formed out of these paradoxes through multiple and varied approaches.

Non-Laplacian beliefs in a global game with noisy signaling

In standard global games, individual behavior is optimal if it constitutes a best response to agnostic—Laplacian—beliefs about the aggregate behavior of other agents. This paper considers a standard binary action global game augmented with noisy signaling by an informed policy-maker and shows that in this game, equilibrium beliefs depart in quite stark ways from the Laplacian benchmark. In the limit as signals become arbitrarily precise, so that all fundamental uncertainty is removed (leaving only strategic uncertainty), the equilibrium beliefs of the marginal individual concerning the aggregate action collapse to a discrete Bernoulli distribution, giving probability mass only to the polar extreme outcomes. By contrast in the underlying standard global game the marginal individual believes the aggregate action has a continuous uniform distribution, giving equal likelihood to all possible outcomes.

The relation between intelligence and reaction time in tasks with increasing cognitive load among athletes with intellectual impairment

Intelligence has long been associated with chronometric performance measures, such as reaction time (RT); however, few studies have investigated this relation in humans at the lower end of the intelligence range. The purpose of this study is to examine the inter-relation between RT, and intelligence in the population of athletes with mild to moderate (IQ 40–75) intellectual impairment (II), according to the DSM-5 diagnostic criteria. IQ-scores were retrieved from the athlete-database, assessed prior to the study by means of the most recently standardized versions of the Stanford-Binet, Raven Progressive Matrices or Wechsler Intelligence Scales, i.e., WISC-V or WAIS-IV. Three RT tasks with increasing cognitive load were administered in this study. The sample consisted of 103 young individuals (32% females, mean age=24.4years, SD=5.8) with II (mean IQ=60.6, SD=9.2), performing the tests prior to competing in the Global Games; the highest level of sport competition, organized by the International Federation for Intellectual Disability Sport. We tested whether IQ and RT were correlated in this sample by means of Pearson's correlations. Afterwards, a comparison sample of tertiary education students was recruited (n=103; mean age=21.1, SD=2.4), whereby for each individual participant with II, a peer was selected on the basis of equal gender, practicing the same sport, and equal accumulated sport expertise. We focused on the possibility that RT tasks requiring higher cognitive load differentiate more between the samples. The 2×3 ANOVA demonstrated a significant group (athletes with II versus comparison group) by task (simple RT, choice RT, complex RT) interaction effect, indicating that the progression of RTs increase across the three tasks with increasing complexity, was more pronounced in the athletes with II than in the comparison sample. This is the first study investigating RT in a large sample of well-trained active individuals with II. It provides a benchmark for other studies and suggests that the impact of lower levels of intelligence on RT is most apparent in RT tasks with the highest cognitive load.

Play between love and labor: The practice of gold farming in China

This article scrutinizes the widespread practice of gold farming in China through two-plus years of field research conducted in 13 gold farming studios across five cities involving 64 participants. Informed by current research and theoretical deliberations on digital labor and co-creative production, the analysis offers insight on the rationales, motivations, and perceptions of gold farming through the practitioners’ perspectives of studio owners, managers, and players. It also explores the role of gold farm studios in the business cycle. Our discussion contextualizes gold farming as a special type of fan labor through transformative gameplay enmeshed in the global game capitalist market and contributes to the understanding of China’s youth-led game culture in general and the variegated intricacies of the trade of gold farming in particular.

Redemption risk and cash hoarding by asset managers

Open-end mutual funds face investor redemptions, but the sale of the underlying assets depends on asset managers’ portfolio decisions. If asset managers use cash holdings as a buffer to meet redemptions, they can mitigate fire sales of the assets. If they hoard cash in response to redemptions, they will amplify fire sales. We present a global game model of investor runs and identify conditions under which asset managers hoard cash. In an empirical investigation of bond mutual funds, we find that cash hoarding is the rule rather than the exception, and that less liquid bond funds display stronger cash hoarding.

Speculator-triggered crisis and interventions

This paper adds a speculator and an authority to a benchmark global game model to investigate how the speculator endangers a business or an economy, and what the authority can do about it. It is found that the existence of a speculator increases the financial system’s vulnerability by serving as a coordinating device for the investors and thus triggering the crisis. We then compare three different intervention policies imposed by the authority aiming to counteract this effect: deterring the speculator, rewarding holding investors, and eliminating the preemption motives among investors. We argue that the first method may not work because of the multiplicity problem; the second one is useless when a crisis is about to happen; the last tool works given enough effort. We also include a discussion of different intervention polices employed by governments during the 1997 Asian financial crisis to illustrate the theoretical results.

The Legal Grounds of Irregular Migration: A Global Game Approach

Abstract This paper analyses the relationship between regular and irregular migration taking into account the migration network effect and the network creation mechanism. We assume that migrants can obtain a high payoff only if a critical mass of migrants is reached in the destination country. If candidates to migration receive biased signals about the economic situation of the destination country, the migrants’ decision problem can be analyzed as a standard global game. Tying the quota of regular migrants to the economic performance of countries might create large discontinuities in immigration flows, with some countries attracting the bulk of irregular migrants and the other being shunned by the migrants.

“Just because he's black”: Identity construction and racial humour in a German U-19 football team

Despite its status as the global game, football has been noted for having problems with racism, and yet relatively little research has actually looked at this topic from a discourse analytical perspective. This paper addresses this gap by exploring the use of racial humour in a German male under-19 football team. Drawing on audio-recordings of interactions among the players on the sideline and substitutes’ bench during, before and after football matches and training, as well as interviews with players, and team observations, we analyse and critically discuss some of the ways in which team members make humorous comments about specific racial, ethnic or national groups when constructing and expressing team membership and negotiating their own and others’ identities within the team. Findings illustrate that, on the one hand, team members express their appreciation of the cultural diversity within their team in an attempt to maintain or enhance team cohesion, but on the other hand, they often use racial humour to create distinctive subgroups thereby fragmenting the team and assigning and foregrounding racial identities.

Banks' Liquidity Management and Systemic Risk

We study a novel mechanism through which systemic risk, in the form of self-fulfilling runs, forces the banks to hoard liquidity. To this end, we develop an environment where banks offer insurance to their depositors against both idiosyncratic and aggregate real uncertainty, by holding a portfolio of liquidity and productive illiquid assets. Moreover, banks’ asset portfolios and the probability of a depositors’ self-fulfilling run are jointly determined via a “global game”. In equilibrium, an endogenous pecking order emerges: if the recovery rate associated with early liquidation of the productive assets is sufficiently low and the depositors are sufficiently risk averse, the banks first employ liquidity and then liquidate the productive asset, in order to finance depositors’ withdrawals. Ex ante, the banks hold more liquidity than in a full-information economy, where there are no self-fulfilling runs and risk is only due to idiosyncratic and aggregate real uncertainty.

MGM RESORTS INTERNATIONAL GLOBAL GAMING DEVELOPMENT, LLC, Plaintiff, v. DANNEL P. MALLOY, in his official capacity as Governor of Connecticut; DENISE W. MERRILL, in her official capacity as Connecticut Secretary of the State; and JONATHAN A. HARRIS, in his official capacity as Commissioner of the Connecticut Department of Consumer Protection, Defendants.

MGM RESORTS INTERNATIONAL GLOBAL GAMING DEVELOPMENT, LLC, Plaintiff, v. DANNEL P. MALLOY, in his official capacity as Governor of Connecticut; DENISE W. MERRILL, in her official capacity as Connecticut Secretary of the State; and JONATHAN A. HARRIS, in his official capacity as Commissioner of the Connecticut Department of Consumer Protection, Defendants.

Local identities in a global game: the social production of football space in Liverpool

ABSTRACTThis paper explores the tensions between local identities and the globalization of the English Premier League by presenting a case study of football fandom in Liverpool. Our findings are based on participant observation and numerous interviews in Liverpool, UK. We examine the tensions resulting from reliance on, and resistance to, tourist-based consumption of the game. We use a Lefebvrian theoretical framework that analyses how football spaces in Liverpool are socially and economically produced, and how the supporters’ groups of different teams in the city work to both globalize and glocalize the football culture of the city. We also look at how supporters are attempting to reshape their relationship with football’s current economic and cultural space. As Liverpool increasingly relies on a tourist-based economy with sport as its focus, the relationships between local and distant supporters, their clubs, and other fans are altered.

Effectiveness of Game Jam-based iterative program for game production in Japan

In this paper, we will introduce a game production program to iterate multiple game development cycles in a limited period. In one semester, we executed a game development process thrice, changing members every time. Students had the opportunity to gain experience, working with different people; also, by being provided a time limit for the development process, they learned how to manage development time effectively. Furthermore, by implementing the plan–do–check–act (PDCA) cycle [ASQ] in each development, students had the opportunity to identify and solve problems during the semester. Using this framework, we worked on the following three educational problems in Japan:(1)Mixed development with students of diverse ages and educational levels(2)Consciousness of development time(3)Understanding of each individual׳s strong and weak pointsFinally, we compared three types of programs (this program, Global Game Jam, and a mentor-based development program) in order to evaluate the aspects of game development that can be learned by them. We discussed how to develop a curriculum using a Game Jam framework. CR categoriesK.3.2 [COMPUTERS AND EDUCATION]: Computer and Information Science Education—Curriculum K.3.2 [COMPUTERS AND EDUCATION]: Computer and Information Science Education—Self-assessment.

Urban revitalization in highly localized squares: A case study of the Historic Centre of Macao

This paper focuses on Macao’s indigenous form of public space – chintei – the historic squares that epitomize the former Portuguese colony and remain a unique feature of the city-state under the rubric of the Special Administrative Region (SAR) of China. With Macao currently experiencing the ambivalence of a cultural enclave versus a global gaming hub, the squares are facing an unprecedented phase of transformation where heritage conservation converges or even collides with redevelopment pressures. Discussions are engaged about the government’s stance on preserving and revitalizing the squares, which can be either regarded as residual space or architectural ensemble and project potentiality of urban heritage especially after the inscription of the Historic Centre of Macao on the World Heritage List. Findings from case studies demonstrate that the squares’ revitalization is a process of trial and error that continuously redefines them, and their diminished socio-spatial vitality has yet to be revived.