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A detail-free mediator

  • Vida, Péter
  • Āzacis, Helmuts

We present a cheap talk extension to any two-player, finite, complete information game, and ask what correlations over actions are implementable in Nash equilibria of the extended game. In the extension, players communicate repeatedly through a detail-free mediator that has been studied in Lehrer (1991) and in Gossner and Vieille (2001). The extension captures situations in which people can observe the opponentʼs face during the conversation. While Gossner and Vieille (2001) prove that no correlation can be securely implemented by using only this mediator, we prove a result closer to Lehrer (1991), namely, that the Nash equilibrium payoffs of the extended game essentially coincide with the correlated equilibrium payoffs of the underlying game. The contrasting results can be explained with our additional assumptions that the players can also communicate directly and, more importantly, the private messages sent to the mediator can be recorded and revealed later in the conversation.

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Article provided by Elsevier in its journal Games and Economic Behavior.

Volume (Year): 81 (2013)
Issue (Month): C ()
Pages: 101-115

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Handle: RePEc:eee:gamebe:v:81:y:2013:i:c:p:101-115
Contact details of provider: Web page: http://www.elsevier.com/locate/inca/622836

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  3. GOSSNER, Olivier, 1997. "Secure protocols or how communication generates correlation," CORE Discussion Papers 1997092, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
  4. Amparo Urbano & Jose E. Vila, 2002. "Computational Complexity and Communication: Coordination in Two-Player Games," Econometrica, Econometric Society, vol. 70(5), pages 1893-1927, September.
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  14. Robert J. Aumann, 1995. "Repeated Games with Incomplete Information," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262011476, June.
  15. Péter Vida & Francoise Forges, 2011. "Implementation of Communication Equilibria by Correlated Cheap Talk: The Two-Player Case," CESifo Working Paper Series 3360, CESifo Group Munich.
  16. Vanessa Teague, 2008. "Problems With Coordination in Two-Player Games: Comment on "Computational Complexity and Communication"," Econometrica, Econometric Society, vol. 76(6), pages 1559-1564, November.
  17. Xavier Jarque & Clara Ponsati & Jozsef Sakovics, 2004. "Mediation: Incomplete information bargaining with filtered communication," ESE Discussion Papers 75, Edinburgh School of Economics, University of Edinburgh.
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  19. Ehud Lehrer & Sylvain Sorin, 1994. "One-Shot Public Mediated Talk," Discussion Papers 1108, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
  20. Gossner, Olivier & Vieille, Nicolas, 2001. "Repeated Communication Through the Mechanism And," Economics Papers from University Paris Dauphine 123456789/6031, Paris Dauphine University.
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