Abstract

http://ssrn.com/abstract=2011773
 
 

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Characterizing Belief-Free Review-Strategy Equilibrium Payoffs Under Conditional Independence


Yuichi Yamamoto


University of Pennsylvania; Harvard University

February 22, 2012

PIER Working Paper No. 12-005

Abstract:     
This paper proposes and studies a tractable subset of Nash equilibria, belief-free review-strategy equilibria, in repeated games with private monitoring. The payoff set of this class of equilibria is characterized in the limit as the discount factor converges to one for games where players observe statistically independent signals. As an application, we develop a simple sufficient condition for the existence of asymptotically efficient equilibria, and establish a folk theorem for N-player prisoner’s dilemma. All these results are robust to a perturbation of the signal distribution, and hence remain true even under almost-independent monitoring.

Number of Pages in PDF File: 74

Keywords: repeated game, private monitoring, conditional independence, belief-free

JEL Classification: C72, C73, D82

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Date posted: February 27, 2012  

Suggested Citation

Yamamoto, Yuichi, Characterizing Belief-Free Review-Strategy Equilibrium Payoffs Under Conditional Independence (February 22, 2012). PIER Working Paper No. 12-005. Available at SSRN: http://ssrn.com/abstract=2011773 or http://dx.doi.org/10.2139/ssrn.2011773

Contact Information

Yuichi Yamamoto (Contact Author)
University of Pennsylvania ( email )
Philadelphia, PA 19104
United States
Harvard University ( email )
1875 Cambridge Street
Cambridge, MA 02138
United States
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References:  28

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