Depth of knowledge and the effect of higher order uncertainty
AbstractA number of recent papers have highlighted the importance of uncertainty about others' information in models of asymmetric information. We introduce a notion that reflects the depth of knowledge in an information system. We show how the depth of knowledge can be used to bound the effect of higher order uncertainty in certain problems. We further provide bounds on the size of bubbles in finite horizon rational expectations models where the bounds depend on the depth of knowledge.
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Bibliographic InfoArticle provided by Springer in its journal Economic Theory.
Volume (Year): 6 (1995)
Issue (Month): 3 ()
Note: Received: March 23, 1994; revised version August 24, 1994
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Web page: http://link.springer.de/link/service/journals/00199/index.htm
Other versions of this item:
- Morris, Stephen & Postlewaite, Andrew & Shin, Hyun Song, 1995. "Depth of Knowledge and the Effect of Higher Order Uncertainty," Economic Theory, Springer, vol. 6(3), pages 453-67, November.
- C51 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Model Construction and Estimation
- E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
- O11 - Economic Development, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
- O47 - Economic Development, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Measurement of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
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- John Conlon, 2005. "Should Central Banks Burst Bubbles?," Game Theory and Information 0508007, EconWPA.
- Jehiel, Philippe & Koessler, Frédéric, 2008.
"Revisiting games of incomplete information with analogy-based expectations,"
Games and Economic Behavior,
Elsevier, vol. 62(2), pages 533-557, March.
- Philippe Jehiel & Frederic Koessler, 2005. "Revisiting Games of Incomplete Information with Analogy-Based Expectations," THEMA Working Papers 2005-04, THEMA (THéorie Economique, Modélisation et Applications), Université de Cergy-Pontoise.
- Philippe Jehiel & Frédéric Koessler, 2006. "Revisiting Games of Incomplete Information with Analogy-Based Expectations," Levine's Bibliography 122247000000000252, UCLA Department of Economics.
- Franklin Allen & Stephen Morris & Hyun Song Shin, 2003.
"Beauty Contests, Bubbles and Iterated Expectations in Asset Markets,"
NajEcon Working Paper Reviews
- Stephen Morris & Franklin Allen & Hyun Song Shin, 2004. "Beauty Contests, Bubbles and Iterated Expectations in Asset Markets," Yale School of Management Working Papers ysm346, Yale School of Management.
- Franklin Allen & Stephen Morris & Hyun Song Shin, 2003. "Beauty Contests, Bubbles and Iterated Expectations in Asset Markets," Cowles Foundation Discussion Papers 1406, Cowles Foundation for Research in Economics, Yale University.
- Rafiqul Bhuyan, 2002. "Information, Alternative Markets, and Security Price Processes: A Survey of Literature," Finance 0211002, EconWPA.
- Amil Dasgupta & Andrea Prat, 2005. "Reputation and Asset Prices: A Theory of Information Cascades and Systematic Mispricing," Levine's Bibliography 784828000000000368, UCLA Department of Economics.
- Rosemarie Nagel & Antonio Cabrales & Roc Armenter, 2002.
"Equilibrium selection through incomplete information in coordination games: An experimental study,"
Economics Working Papers
601, Department of Economics and Business, Universitat Pompeu Fabra.
- Antonio Cabrales & Rosemarie Nagel & Roc Armenter, 2007. "Equilibrium selection through incomplete information in coordination games: an experimental study," Experimental Economics, Springer, vol. 10(3), pages 221-234, September.
- John R. Conlon, 2008. "Should Central Banks Burst Bubbles? Some Microeconomic Issues," Levine's Working Paper Archive 122247000000002330, David K. Levine.
- JÃ³zsef SÃ¡kovics, 2001.
"Games of Incomplete Information Without Common Knowledge Priors,"
Theory and Decision,
Springer, vol. 50(4), pages 347-366, June.
- Jozsef Sakovics, 2004. "Games of incomplete information without common knowledge priors," ESE Discussion Papers 77, Edinburgh School of Economics, University of Edinburgh.
- Frédéric KOESSLER, 2001.
"Persuasion Games with Higher Order Uncertainty,"
Working Papers of BETA
2001-14, Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg.
- Franklin Allen & Stephen Morris & Hyun Song Shin, 2003. "Beauty Contests, Bubbles and Iterated Expectations in Asset Markets Capital Adequacy Regulation: In Search of a Rationale," Center for Financial Institutions Working Papers 03-06, Wharton School Center for Financial Institutions, University of Pennsylvania.
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