We here develop a model of pre-play communication that generalizes the cheap-talk approach by allowing players to have a lexicographic preference, second to the payoffs in the underlying game, for honesty. We formalize this by way of an honesty (or truth) correspondence between actions and...

This paper studies a repeated play of a family of games by resource-constrained players. To economize on reasoning resources, the family of games is partitioned into subsets of games which players do not distinguish. An example is constructed to show that when games are played a finite number of...

Second price allpay auctions (wars of attritions) have an evolutionarily stable equilibrium in pure strategies if valuations are private information. I show that for any level of uncertainty there exists a pure deviation strategy close to the equilibrium strategy such that for some valuations...

Second price allpay auctions (wars of attritions) have an evolutionarily stable equilibrium in pure strategies if valuations are private information. I show that for any level of uncertainty there exists a pure deviation strategy close to the equilibrium strategy such that for some valuations...

Experimental evidence suggests that people tend to be overconfident in the sense that they overestimate the accuracy of their own predictions. In this paper we present a simple principal-agent model in which principal's interest in dispersing risk motivates him to hire overconfident agents. We...

Nash proposed an interpretation of mixed strategies as the average pure-strategy play of a population of players randomly matched to play a normal-form game. If populations are finite, some equilibria of the underlying game have no such corresponding “mass-action” equilibrium. We show that...

Motivated by trying to better understand the norms that govern pedestrian traffic, I study symmetric two-player coordination games with independent private values. The strategies of "always pass on the left" and "always pass on the right" are always equilibria of this game. Some such games,...

We study stable behavior when players are randomly matched to play a game, and before the game begins each player may observe how his partner behaved in a few interactions in the past. We present a novel modeling approach and we show that strict Nash equilibria are always stable in such...

This discussion paper resulted in a publication in <A href="http://link.springer.com/article/10.1007%2Fs11238-010-9196-5">'Theory and Decision'</A>, 2011, 71(2), 269-295.<P> Unique-lowest sealed-bid auctions are auctions in which participation is endogenous and the winning bid is the lowest bid among all unique bids. Such auctions admit very many Nash equilibria (NEs) in...</p></a>