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...

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...

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...

In contrast to the existing literature on repeated games that assumes a fixed discount factor, I study an environment in which it is more realistic to assume a fluctuating discount factor. In a repeated oligopoly, as the interest rate changes, so too does the degree to which firms discount the...

It is well known that the presence of imperfect monitoring limits the possibility of making efficient agreements. When firms interact repeatedly in multiple markets, however, we show that noisy observations may improve the possibility of collusion. When observation is noisy in at least one...

Our paper considers a 'negotiation game' between two players which combines the features of two-players alternating offers bargaining and repeated games. Generally, the negotiation game in general admits a large number of equilibriums but some of which involve delay and inefficiency. Thus,...

Theoretical literature on collusion has focused on a specific formulation of payoff fluctuations, namely by demand shocks, and showed that payoff fluctuations are bad for collusion. Introducing general payoff fluctuations, we show that (i) payoff fluctuations may strictly reduce the minimum...

We show that in symmetric two-player exact potential games, the simple decision rule "imitate-if-better" cannot be beaten by any strategy in a repeated game by more than the maximal payoff difference of the one-period game. Our results apply to many interesting games including examples like 2x2...