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Coordination Failure in Repeated Games with Almost-Public Monitoring

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Abstract

Some private-monitoring games, that is, games with no public histories, can have histories that are almost public. These games are the natural result of perturbing public-monitoring games towards private monitoring. We explore the extent to which it is possible to coordinate continuation play in such games. It is always possible to coordinate continuation play by requiring behavior to have bounded recall (i.e., there is a bound L such that in any period, the last L signals are sufficient to determine behavior). We show that, in games with general almost-public private monitoring, this is essentially the only behavior that can coordinate continuation play.

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File URL: http://cowles.econ.yale.edu/P/cd/d14b/d1479.pdf
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Bibliographic Info

Paper provided by Cowles Foundation for Research in Economics, Yale University in its series Cowles Foundation Discussion Papers with number 1479.

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Length: 37 pages
Date of creation: Sep 2004
Date of revision:
Publication status: Published in Theoretical Economics (2006), 1: 311-340
Handle: RePEc:cwl:cwldpp:1479

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Postal: Cowles Foundation, Yale University, Box 208281, New Haven, CT 06520-8281 USA

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Keywords: Repeated games; Private monitoring; Almost-public monitoring; Coordination; Bounded recall;

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