Strategic information transmission: a mathematica tool for analysis
AbstractEconomists and other applied researchers use game theory to study industrial organization, financial markets, and the theory of the firm. In an earlier article in the Mathematica Journal, [Dickhaut and Kaplan 1991] present a procedure for solving two-person games of complete information. In many applications, however, "asymmetric information" is a central issue. By asymmetric information, we mean that one party has access to information that the other party lacks. The branch of game theory that deals with this problem is known as "games of incomplete information"; the formal model is discussed in [Harsanyi 1967]. [Myerson 1991, Tirole 1989] et al, discuss the applications but do not focus on computational procedures. We provide, in this article, an application of Mathematica to games of incomplete information that should be of interest for two reasons: (i) as a basis for thinking about solutions to games of incomplete information, and (ii) as an approach to understanding the particular application presented here, namely, the effect of strategic information transmission in firms and markets.
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Bibliographic InfoPaper provided by University Library of Munich, Germany in its series MPRA Paper with number 33869.
Date of creation: Sep 1992
Date of revision:
Mathematica; Strategic Information Transmission; Crawford Sobel Model;
Find related papers by JEL classification:
- D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
- C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative 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.:
- Todd R. Kaplan & John Dickhaut, . "A Program for Finding Nash Equilibria," Working papers _004, University of Minnesota, Department of Economics.
- Crawford, Vincent P & Sobel, Joel, 1982.
"Strategic Information Transmission,"
Econometric Society, vol. 50(6), pages 1431-51, November.
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