Finitely Repeated Games with Monitoring Options
AbstractWe study finitely repeated games where players can decide whether to monitor the other players' actions or not every period. Monitoring is assumed to be costless and private. We compare our model with the standard one where the players automatically monitor each other. Since monitoring other players never hurts, any equilibrium payoff vector of a standard finitely repeated game is an equilibrium payoff vector of the same game with monitoring options. We show that some finitely repeated games with monitoring options have sequential equilibrium outcomes which cannot be sustained under the standard model, even if the stage game has a unique Nash equilibrium. We also present sufficient conditions for a folk theorem, when the players have a long horizon.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by Kobe University, Graduate School of Business Administration in its series Discussion Papers with number 2011-44.
Length: 26 pages
Date of creation: Oct 2011
Date of revision:
Finitely repeated games; Imperfect monitoring; Folk theorem;
Find related papers by JEL classification:
- C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
- C73 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Stochastic and Dynamic Games; Evolutionary Games
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.:
- Gossner, Olivier, 1995. "The Folk Theorem for Finitely Repeated Games with Mixed Strategies," International Journal of Game Theory, Springer, vol. 24(1), pages 95-107.
- Eiichi Miyagawa & Yasuyuki Miyahara & Tadashi Sekiguchi, 2003.
"Repeated Games with Observation Costs,"
0203-14, Columbia University, Department of Economics.
- Michihiro Kandori, 2001.
"Introduction to Repeated Games with Private Monitoring,"
CIRJE-F-114, CIRJE, Faculty of Economics, University of Tokyo.
- Kandori, Michihiro, 2002. "Introduction to Repeated Games with Private Monitoring," Journal of Economic Theory, Elsevier, vol. 102(1), pages 1-15, January.
- Barton L. Lipman & Ruqu Wang, 1997.
"Switching Costs in Frequently Repeated Games,"
1190, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
- Fudenberg, Drew & Maskin, Eric, 1986. "The Folk Theorem in Repeated Games with Discounting or with Incomplete Information," Econometrica, Econometric Society, vol. 54(3), pages 533-54, May.
- Gonzalez-Diaz, Julio, 2006. "Finitely repeated games: A generalized Nash folk theorem," Games and Economic Behavior, Elsevier, vol. 55(1), pages 100-111, April.
- Miyagawa, Eiichi & Miyahara, Yasuyuki & Sekiguchi, Tadashi, 2008. "The folk theorem for repeated games with observation costs," Journal of Economic Theory, Elsevier, vol. 139(1), pages 192-221, March.
- Flesch, János & Perea, Andrés, 2009.
"Repeated games with voluntary information purchase,"
Games and Economic Behavior,
Elsevier, vol. 66(1), pages 126-145, May.
- Flesch, János & Perea, Andrés, 2007. "Repeated Games with Voluntary Information Purchase," Research Memoranda 057, Maastricht : METEOR, Maastricht Research School of Economics of Technology and Organization.
- Osório Costa, Antonio Miguel, 2012. "The Limits of Discrete Time Repeated Games:Some Notes and Comments," Working Papers 2072/203171, Universitat Rovira i Virgili, Department of Economics.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Yasuyuki Miyahara).
If references are entirely missing, you can add them using this form.