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Coordinating under incomplete information

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  • Geir Asheim
  • Seung Yoo

Abstract

We show that, in a minimum effort game with incomplete information where player types are independently drawn, there is a largest and smallest Bayesian equilibrium, leading to the set of equilibrium payoffs (as evaluated at the interim stage) having a lattice structure. Furthermore, the range of equilibrium payoffs converges to those of the deterministic complete information version of the game, in the limit as the incomplete information vanishes. This entails that such incomplete information alone cannot explain the equilibrium selection suggested by experimental evidence.
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Suggested Citation

  • Geir Asheim & Seung Yoo, 2008. "Coordinating under incomplete information," Review of Economic Design, Springer;Society for Economic Design, vol. 12(4), pages 293-313, December.
    • Handle: RePEc:spr:reecde:v:12:y:2008:i:4:p:293-313
    DOI: 10.1007/s10058-008-0061-8
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    More about this item

    Keywords

    Minimum effort games; Coordination games; Incomplete information; C72;
    All these keywords.

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games

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