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 investigate whether two players in a long-run relationship can maintain cooperation when the details of the underlying game are unknown. Specifically, we consider a new class of repeated games with private monitoring, where an unobservable state of the world influences the payoff functions...

This paper studies repeated trade with noisy information about previous transactions. A buyer has private information about his willingness to pay, which is either low or high, and buys goods from different sellers over time. Each seller observes a noisy history of signals about the buyer's...

Repetition is a classic mechanism for the evolution of cooperation. The standard way to study repeated games is to assume that there is an exogenous probability with which every interaction is repeated. If it is sufficiently likely that interactions are repeated, then reciprocity and cooperation...

Repetition is a classic mechanism for the evolution of cooperation. The standard way to study repeated games is to assume that there is an exogenous probability with which every interaction is repeated. If it is sufficiently likely that interactions are repeated, then reciprocity and cooperation...

Algorithms play an increasingly important role in economic situations. These situations are often strategic, where the artificial intelligence may or may not be cooperative. We study the deter-minants and forms of algorithmic cooperation in the infinitely repeated prisoner’s dilemma. We run a...