Stochastic games with hidden states
This paper studies infinite‐horizon stochastic games in which players observe actions and noisy public information about a hidden state each period. We find a general condition under which the feasible and individually rational payoff set is invariant to the initial prior about the state when players are patient. This result ensures that players can punish or reward their opponents via continuation payoffs in a flexible way. Then we prove the folk theorem, assuming that public randomization is available. The proof is constructive and uses the idea of random blocks to design an effective punishment mechanism.
Year of publication: |
2019
|
---|---|
Authors: | Yamamoto, Yuichi |
Published in: |
Theoretical Economics. - The Econometric Society, ISSN 1933-6837, ZDB-ID 2220447-7. - Vol. 14.2019, 3, p. 1115-1167
|
Publisher: |
The Econometric Society |
Saved in:
Online Resource
Saved in favorites
Similar items by person
-
Stochastic games with hidden states
Yamamoto, Yuichi, (2019)
-
Common learning and cooperation in repeated games
Sugaya, Takuo, (2020)
-
Common learning and cooperation in repeated games
Sugaya, Takuo, (2020)
- More ...