We investigate the relations between different types of perfect equilibrium, introduced by Simon and Stinchcombe (1995) for games with compact action spaces and continuous payoffs. Simon and Stinchcombe distinguish two approaches to perfect equilibrium in this context, the classical "trembling...

We study a framework where two duopolists compete repeatedly in prices and where chosen prices potentially affect future market shares, but certainly do not affect current sales. This assumption of consumer inertia causes (noncooperative) coordination on high prices only to be possible as an...

We study a framework where two duopolists compete repeatedly in prices and where cho-sen prices potentially affect future market shares, but certainly do not affect current sales.This assumption of consumer inertia causes (noncooperative) coordination on high pricesonly to be possible as an...

We consider a game G(n) played by two players. There are n independent random variables Z(1),...,Z(n), each of which is uniformly distributed on [0,1]. Both players know n, the independence and the distribution of these random variables, but only player 1 knows the vector of realizations z :=...

The mechanism used in Nash implementation is a form of direct democracy, taking everyone''s opinion into account. We augment this mechanism with a political process that selects the opinions of a subset of the individuals. We study three such processes -- oligarchy, oligarchic democracy and...

We study the implications of procedural fairness on income taxation. We formulateprocedural fairness as a particular non-cooperative bargaining game and examine thestationary subgame perfect equilibria of the game. The equilibrium outcome is called tax equilibrium and is shown to be unique. The...

In this paper, we consider a finite set of agents with commonly known full-support priors on the fundamental space of uncertainty. Then, we show that if the hierarchies of conditional beliefs á la Battigalli and Siniscalchi (1999) are derived from these priors, then all types of the same agent...

This paper discusses and illustrates identification problems in personality psychology. The measures used by psychologists to infer traits are based on behaviors, broadly defined. These behaviors are produced from multiple traits interacting with incentives in situations. In general, measures...

We model a three-pillar pension system and analyse in this context the impact of the financial crisis on the aggregate economy, using an overlapping generations model where individuals live for two periods. The system consists of (1) a PAYG pension system, (2) a Defined Benefit pension fund, and...

This paper proposes an assignment model where sorting occurs on attributes that are simultaneously a skill (Sattinger, 1979) and a preference (Tinbergen, 1956). The key feature of this model is that the wage function admits both jobs'' and workers'' attributes as arguments. Since this function...