Valuating Payoff Streams under Unequal Discount Factors

We study repeated prize allocation problem when the discount factors f the agents are not equal. It is shown that the feasible set of payoffs is not well behaved. In particular, it is not convex as it contains holes and caves. The Pareto frontier is everywhere discontinuous and there is an open subset of discount factors such that the feasible set is totally disconnected.

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Year of publication:	2007
Authors:	Salonen, Hannu ; Vartiainen, Hannu
Publisher:	Turku : Aboa Centre for Economics (ACE)
Subject:	payoffs \| differentiated discount factor \| repeated games

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Series:	Discussion paper ; 16
Type of publication:	Book / Working Paper
Type of publication (narrower categories):	Working Paper
Language:	English
Other identifiers:	hdl:10419/233232 [Handle] RePEc:tkk:dpaper:dp16 [RePEc]
Classification:	C60 - Mathematical Methods and Programming. General ; C70 - Game Theory and Bargaining Theory. General
Source:	EconStor

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