"Interlinkage and Generous Tit-for-Tat Strategy"
We investigate an infinitely repeated prisoners' dilemma with imperfect monitoring and projects the possibility that the interlinkage of the players' distinct activities enhances implicit collusion. We show a necessary and sufficient condition for the existence of generous tit-for-tat Nash equilibrium. Such an equilibrium, if it exists, is unique. This equilibrium achieves approximate efficiency when monitoring is almost perfect, where the discount factors are fixed.
Year of publication: |
2013-02
|
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Authors: | Matsushima, Hitoshi |
Institutions: | Center for International Research on the Japanese Economy (CIRJE), Faculty of Economics |
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