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Complementarities and Games: New Developments

Vives, Xavier - C.E.P.R. Discussion Papers - 2004

The theory of monotone comparative statics and supermodular games is presented as the appropriate tool to model complementarities. The approach, which has not yet been fully incorporated into the standard toolbox of researchers, makes the analysis intuitive and simple, helps in deriving new...

Persistent link: https://www.econbiz.de/10005123543

Strategic Experimentation with Exponential Bandits

Cripps, Martin William; Keller, R Godfrey; Rady, Sven - C.E.P.R. Discussion Papers - 2003

This Paper studies a game of strategic experimentation with two-armed bandits whose risky arm might yield a pay-off only after some exponentially distributed random time. Because of free-riding, there is an inefficiently low level of experimentation in any equilibrium where the players use...

Persistent link: https://www.econbiz.de/10005124141

Strategic Experimentation and Disruptive Technological Change

Schivardi, Fabiano; Schneider, Martin - C.E.P.R. Discussion Papers - 2005

This paper studies the diffusion of a new technology that is brought to market while its potential is still uncertain. We consider a dynamic game in which firms improve both a new and a rival old technology while learning about the relative potential of both technologies. We use the model to...

Persistent link: https://www.econbiz.de/10005504449

Negatively Correlated Bandits

Klein, Nicolas; Rady, Sven - C.E.P.R. Discussion Papers - 2008

We analyze a two-player game of strategic experimentation with two-armed bandits. Each player has to decide in continuous time whether to use a safe arm with a known payoff or a risky arm whose likelihood of delivering payoffs is initially unknown. The quality of the risky arms is perfectly...

Persistent link: https://www.econbiz.de/10005662209

Competitive Rational Expectations Equilibria Without Apology

Kovalenkov, Alex; Vives, Xavier - C.E.P.R. Discussion Papers - 2008

In a standard financial market model with asymmetric information with a finite number N of risk-averse informed traders, competitive rational expectations equilibria provide a good approximation to strategic equilibria as long as N is not too small: equilibrium prices in each situation converge...

Persistent link: https://www.econbiz.de/10005792292

Second-price common value auctions with uncertainty, private and public information: experimental evidence

Brocas, Isabelle; Carrillo, Juan D; Castro, Manuel - C.E.P.R. Discussion Papers - 2015

We conduct a laboratory experiment of second-price sealed bid auctions of a common value good with two bidders. Bidders … bidder) and public information (known by both bidders), and auctions differ on the relative importance of these three types … and public information and systematic overbidding in all auctions above and beyond the standard winner's curse. The Cursed …

Persistent link: https://www.econbiz.de/10011165658

Optimal Allocations in Round-Robin Tournaments

Krumer, Alex; Megidish, Reut; Sela, Aner - C.E.P.R. Discussion Papers - 2014

We study round-robin tournaments with three players whose values of winning are common knowledge. In every stage a pair-wise match is modelled as an all-pay auction. The player who wins in two matches wins the tournament. We characterize the sub-game perfect equilibrium for symmetric (all...

Persistent link: https://www.econbiz.de/10011083965

Common-Value All-Pay Auctions with Asymmetric Information

Einy, Ezra; Haimanko, Ori; Orzach, Ram; Sela, Aner - C.E.P.R. Discussion Papers - 2013

We study two-player common-value all-pay auctions (contests) with asymmetric information under the assumption that one …

Persistent link: https://www.econbiz.de/10011084342

All-pay auctions with certain and uncertain prizes

Minchuk, Yizhaq; Sela, Aner - C.E.P.R. Discussion Papers - 2014

We study all-pay auctions with multiple prizes. The players have the same value for all the certain prizes except for …

Persistent link: https://www.econbiz.de/10011083545

Strategic Supply Function Competition with Private Information

Vives, Xavier - C.E.P.R. Discussion Papers - 2008

A finite number of sellers (n) compete in schedules to supply an elastic demand. The costs of the sellers have uncertain common and private value components and there is no exogenous noise in the system. A Bayesian supply function equilibrium is characterized; the equilibrium is privately...

Persistent link: https://www.econbiz.de/10005789071