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Towards a theory of deception Author info | Abstract | Publisher info | Download info | Related research | Statistics David Ettinger
Philippe Jehiel
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This paper proposes an equilibrium approach to deception where deception is defined to be the process by which actions are chosen to induce erroneous inferences so as to take advantage of them. Specifically, we introduce a framework with boundedly rational players in which agents make inferences based on a coarse information about others' behaviors: Agents are assumed to know only the average reaction function of other agents over groups of situations. Equilibrium requires that the coarse information available to agents is correct, and that inferences and optimizations are made based on the simplest theories compatible with the available information. We illustrate the phenomenon of deception and how reputation concerns may arise even in zero-sum games in which there is no value to commitment. We further illustrate how the possibility of deception affects standard economic insights through a number of stylized applications including a monitoring game and two simple bargaining games. The approach can be viewed as formalizing into a game theoretic setting a well documented bias in social psychology, the Fundamental Attribution Error.
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Paper provided by PSE (Ecole normale supérieure) in its series PSE Working Papers with number
2005-28.
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Date of creation: 2005Date of revision:
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References listed on IDEAS 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.: Uri Gneezy, 2005.
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Philippe Jehiel & Frédéric Koessler, 2006.
"Revisiting Games of Incomplete Information with Analogy-Based Expectations ,"
Levine's Bibliography
122247000000000252, UCLA Department of Economics.
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Other versions:
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.
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"Revisiting games of incomplete information with analogy-based expectations ,"
Games and Economic Behavior ,
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"Parental Guidance and Supervised Learning ,"
Levine's Bibliography
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Other versions:
Alessandro Lizzeri & Marciano Siniscalchi, 2007.
"Parental Guidance and Supervised Learning ,"
NajEcon Working Paper Reviews
843644000000000090, www.najecon.org.
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Discussion Papers
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The Quarterly Journal of Economics ,
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"Inference By Believers In The Law Of Small Numbers ,"
The Quarterly Journal of Economics ,
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BENABOU, Roland & TIROLE, Jean, 2006.
"Identity, Dignity and Taboos: Beliefs as Assets ,"
IDEI Working Papers
437, Institut d'Économie Industrielle (IDEI), Toulouse.
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Other versions:
Roland Bénabou & Jean Tirole, 2007.
"Identity, Dignity and Taboos: Beliefs as Assets ,"
IZA Discussion Papers
2583, Institute for the Study of Labor (IZA).
[Downloadable!] Roland Bénabou & Jean Tirole, 2007.
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Carlo Alberto Notebooks
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CEPR Discussion Papers
6123, C.E.P.R. Discussion Papers.
[Downloadable!] (restricted) Drew Fudenberg & David Levine, 1987.
"Reputation and Equilibrium Selection in Games With a Patient Player ,"
Working papers
461, Massachusetts Institute of Technology (MIT), Department of Economics.
Other versions:
Drew Fudenberg & David K. Levine, 1995.
"Reputation and Equilibrium Selection in Games with a Patient Player ,"
Levine's Working Paper Archive
103, UCLA Department of Economics.
[Downloadable!] D. Fudenberg & David K. Levine, 1989.
"Reputation and Equilibrium Selection in Games with a Patient Player ,"
Levine's Working Paper Archive
508, UCLA Department of Economics.
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"Reputation and Equilibrium Selection in Games with a Patient Player ,"
Econometrica ,
Econometric Society, vol. 57(4), pages 759-78, July.
[Downloadable!] (restricted) David Laibson, 2001.
"A Cue-Theory Of Consumption ,"
The Quarterly Journal of Economics ,
MIT Press, vol. 116(1), pages 81-119, February.
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Vincent P. Crawford, 2003.
"Lying for Strategic Advantage: Rational and Boundedly Rational Misrepresentation of Intentions ,"
American Economic Review ,
American Economic Association, vol. 93(1), pages 133-149, March.
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Other versions: Spence, A Michael, 1973.
"Job Market Signaling ,"
The Quarterly Journal of Economics ,
MIT Press, vol. 87(3), pages 355-74, August.
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Kreps, David M & Wilson, Robert, 1982.
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Econometrica ,
Econometric Society, vol. 50(4), pages 863-94, July.
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Other versions: Michele Piccione & Ariel Rubinstein, 2002.
"Modelling the Economic Interaction of Agents with Diverse Abilities to Recognise Equilibrium Patterns ,"
STICERD - Theoretical Economics Paper Series
440, Suntory and Toyota International Centres for Economics and Related Disciplines, LSE.
[Downloadable!]
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references Cited by : (explanations , 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.)
Philippe Jehiel, 2007.
"Manipulative Auction Design ,"
Levine's Bibliography
122247000000001547, UCLA Department of Economics.
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Jihong Lee, 2007.
"Unforeseen Contingency and Renegotiation with Asymmetric Information ,"
Birkbeck Working Papers in Economics and Finance
0717, Birkbeck, School of Economics, Mathematics & Statistics.
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