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Trust and betrayals: Reputational payoffs and behaviors without commitment

Pei, Harry - In: Theoretical Economics 16 (2021) 2, pp. 449-475

I study a repeated game in which a patient player wants to win the trust of some myopic opponents but can strictly benefit from betraying them. His benefit from betrayal is strictly positive and is his persistent private information. I characterize every type of patient player's highest...

Persistent link: https://www.econbiz.de/10013189075

Coordination failure in repeated games with almost-public monitoring

Mailath, George J.; Morris, Stephen - In: Theoretical Economics 1 (2006) 3, pp. 311-340

Some private-monitoring games, that is, games with no public histories, can have histories that are almost public. These games are the natural result of perturbing public monitoring games towards private monitoring. We explore the extent to which it is possible to coordinate continuation play in...

Persistent link: https://www.econbiz.de/10011599373

Efficiency in repeated trade with hidden valuations

Athey, Susan; Miller, David A. - In: Theoretical Economics 2 (2007) 3, pp. 299-354

We analyze the extent to which efficient trade is possible in an ongoing relationship between impatient agents with hidden valuations (i.i.d. over time), restricting attention to equilibria that satisfy ex post incentive constraints in each period. With ex ante budget balance, efficient trade...

Persistent link: https://www.econbiz.de/10011599391

Robustness to incomplete information in repeated games

Takahashi, Satoru; Chassang, Sylvain - In: Theoretical Economics 6 (2011) 1, pp. 49-93

This paper extends the framework of Kajii and Morris (1997) to study the question of robustness to incomplete information in repeated games. We show that dynamically robust equilibria can be characterized using a one-shot robustness principle that extends the one-shot deviation principle. Using...

Persistent link: https://www.econbiz.de/10011599438

Dynamic markets for lemons: performance, liquidity, and policy intervention

Moreno, Diego; Wooders, John - In: Theoretical Economics 11 (2016) 2, pp. 601-639

We study non-stationary dynamic decentralized markets with adverse selection in which trade is bilateral and prices are determined by bargaining. Examples include labor markets, housing markets, and markets for financial assets. We characterize equilibrium, and identify the dynamics of...

Persistent link: https://www.econbiz.de/10011599579

Efficient dynamic mechanisms in environments with interdependent valuations: The role of contingent transfers

Liu, Heng - In: Theoretical Economics 13 (2018) 2, pp. 795-829

This paper addresses the problem of implementing socially efficient allocations in dynamic environments with interdependent valuations and evolving private information. In the case where the agents' information is correlated across time, we construct efficient and incentive compatible direct...

Persistent link: https://www.econbiz.de/10012010044

Optimal sequential contests

Hinnosaar, Toomas - In: Theoretical Economics 19 (2024) 1, pp. 207-244

I study sequential contests where the efforts of earlier players may be disclosed to later players by nature or by design. The model has many applications, including rent seeking, R&D, oligopoly, public goods provision, and tragedy of the commons. I show that information about other players'...

Persistent link: https://www.econbiz.de/10014536866

Strategic investment evaluation

Kirpalani, Rishabh; Madsen, Erik - In: Theoretical Economics 18 (2023) 3, pp. 1141-1180

We study the interaction of incentives to free-ride on information acquisition and strategically delay irreversible investment in environments in which multiple firms evaluate an investment opportunity. In our model, two firms decide how quickly to privately obtain information about the...

Persistent link: https://www.econbiz.de/10014536873

Dynamic signaling with stochastic stakes

Gryglewicz, Sebastian; Kolb, Aaron - In: Theoretical Economics 17 (2022) 2, pp. 539-559

chooses whether to continue receiving a return that is an increasing function of both her reputation and an exogenous public …, and she builds a reputation by continuing when the stakes reach a new minimum. We discuss applications to corporate … reputation management, online vendor reputation, and limit pricing with stochastic demand. …

Persistent link: https://www.econbiz.de/10014536892

Bargaining with evolving private information

Ortner, Juan - In: Theoretical Economics 18 (2023) 3, pp. 885-916

I study how the arrival of new private information affects bargaining outcomes. A seller makes offers to a buyer. The buyer is privately informed about her valuation, and the seller privately observes her stochastically changing cost of delivering the good. Prices fall gradually at the early...

Persistent link: https://www.econbiz.de/10014536929

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