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Competition, Profitability, and Discount Rates

Dou, Winston - 2020

We build an asset-pricing model with dynamic strategic competition to explain the strong joint fluctuations in aggregate discount rates, competition intensity, profitability, and asset prices. Product market competition endogenously intensifies as discount rates rise, because firms compete more...

Persistent link: https://www.econbiz.de/10012850510

Characterizing Belief-Free Review-Strategy Equilibrium Payoffs Under Conditional Independence

Yamamoto, Yuichi - 2012

This paper proposes and studies a tractable subset of Nash equilibria, belief-free review-strategy equilibria, in repeated games with private monitoring. The payoff set of this class of equilibria is characterized in the limit as the discount factor converges to one for games where players...

Persistent link: https://www.econbiz.de/10013110135

A note on "Necessary and sufficient conditions for the perfect finite horizon folk theorem" : [Econometrica, 63 (2): 425-430, 1995.]

Demeze-Jouatsa, Ghislain H. - 2018 - This version: July 28, 2018

Smith (1995) presented a necessary and sufficient condition for the finite- horizon perfect folk theorem. In the proof of this result, the author constructed a family of five-phase strategy profiles to approach feasible and individually rational payoff vec- tors of the stage-game. These strategy...

Persistent link: https://www.econbiz.de/10011891318

A complete folk theorem for finitely repeated games

Demeze-Jouatsa, Ghislain H. - 2018

I analyze the set of pure strategy subgame perfect Nash equilibria of any finitely repeated game with complete information and perfect monitoring. The main result is a complete characterization of the limit set, as the time horizon increases, of the set of pure strategy subgame perfect Nash...

Persistent link: https://www.econbiz.de/10011891361

Characterizing the limit set of perfect and public equilibrium payoffs with unequal discounting

Sugaya, Takuo - In: Theoretical economics : TE ; an open access journal in … 10 (2015) 3, pp. 691-717

We study repeated games with imperfect public monitoring and unequal discounting. We characterize the limit set of …

Persistent link: https://www.econbiz.de/10011673281

Stochastic Discounting in Repeated Games : Awaiting the Almost Inevitable

Barlo, Mehmet - 2011

We study repeated games with pure strategies and stochastic discounting under perfect information, with the requirement … stochastic, discount factor where associated stochastic discounting processes are required to satisfy Markov property, martingale …

Persistent link: https://www.econbiz.de/10013130679

Risk and Repeated Games : Is Random Termination a Reasonable Proxy For Discounting?

Candreva, Christopher - 2019

This paper looks to see if departures from risk neutrality cause subjects to behave differently in randomly terminated supergames compared to infinitely discounted supergames. I show that if subjects have a strictly monotonic utility function, and that utility function is applied to their entire...

Persistent link: https://www.econbiz.de/10012901787

Repeated Games with Endogenous Discounting

Kochov, Asen - 2016

The paper studies infinitely repeated games in which the players' rates of time preference may evolve over time, depending on what transpires in the game. A key result is that in any first best equilibrium of the repeated prisoners' dilemma, the players must eventually cooperate. If we assume...

Persistent link: https://www.econbiz.de/10013001655

Infinitely Repeated Games in the Laboratory : Four Perspectives on Discounting and Random Termination

Fréchette, Guillaume R. - 2013

While infinitely repeated games with payoff discounting are theoretically isomorphic to randomly terminated repeated … games without payoff discounting, in practice, they correspond to very different environments. The standard method for … payoff discounting, followed by random termination (proposed by Cabral, Ozbay, and Schotter [2011]) or followed by a …

Persistent link: https://www.econbiz.de/10013086077

The Folk Theorem for Repeated Games With Time-Dependent Discounting

Li, Xiaoxi - 2019

This paper defines a general framework to study infinitely repeated games with time-dependent discounting, in which we …'s with the quasi-hyperbolic discounting …

Persistent link: https://www.econbiz.de/10012868118