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Statistical Inference as a Bargaining Game

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  • Mr. Eduardo Ley

Abstract

This paper extends the analogy, previously established by Learner (1978a), between a Bayesian inference problem and an economics allocation problem to show that posterior modes can be interpreted as optimal outcomes of a bargaining game. This bargaining game, over a parameter value, is played between two players: the researcher (with preferences represented by the prior) and the data (with preferences represented by the likelihood).

Suggested Citation

  • Mr. Eduardo Ley, 2002. "Statistical Inference as a Bargaining Game," IMF Working Papers 2002/081, International Monetary Fund.
    • Handle: RePEc:imf:imfwpa:2002/081
    as

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    References listed on IDEAS

    as
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    5. Walter N. Thurman & Tyler J. Fox & Tayler H. Bingham, 2001. "Imposing Smoothness Priors In Applied Welfare Economics: An Application Of The Information Contract Curve To Environmental Regulatory Analysis," The Review of Economics and Statistics, MIT Press, vol. 83(3), pages 511-522, August.
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    8. Ken Binmore, 1998. "Game Theory and the Social Contract - Vol. 2: Just Playing," MIT Press Books, The MIT Press, edition 1, volume 2, number 0262024446, December.
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    More about this item

    Keywords

    WP; contract curve;

    JEL classification:

    • C11 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Bayesian Analysis: General
    • C7 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory

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