In traditional reputation models, the ability to build a reputation is good for the long-run player. In [Ely, J., Valimaki, J., 2003. Bad reputation. NAJ Econ. 4, 2; http://www.najecon.org/v4.htm. Quart. J. Econ. 118 (2003) 785-814], Ely and Valimaki give an example in which reputation is unambiguously bad. This paper characterizes a class of games in which that insight holds. The key to bad reputation is that participation is optional for the short-run players, and that every action of the long-run player that makes the short-run players want to participate has a chance of being interpreted as a signal that the long-run player is "bad." We allow a broad set of commitment types, allowing many types, including the "Stackelberg type" used to prove positive results on reputation. Although reputation need not be bad if the probability of the Stackelberg type is too high, the relative probability of the Stackelberg type can be high when all commitment types are unlikely.
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Jeffery Ely & Drew Fudenberg & David Levine, 2002.
"When is Reputation Bad?,"
Discussion Papers
1358, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
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George J. Mailath & Larry Samuelson, .
""Who Wants a Good Reputation?'',"
CARESS Working Papres
98-12, University of Pennsylvania Center for Analytic Research and Economics in the Social Sciences.
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George J. Mailath & Larry Samuelson, 2000.
"Who Wants a Good Reputation?,"
CARESS Working Papres
sell-rep, University of Pennsylvania Center for Analytic Research and Economics in the Social Sciences.
[Downloadable!]
Jeffrey C. Ely & Juuso Valimaki, 2002.
"Bad Reputation,"
Discussion Papers
1348, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
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Cited by: (explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)
Matthew Gentzkow & Jesse Shapiro, 2005.
"Media Bias and Reputation,"
NBER Working Papers
11664, National Bureau of Economic Research, Inc.
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