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Blackwell Equilibrium in Repeated Games

Author

Listed:
  • Costas Cavounidis
  • Sambuddha Ghosh
  • Johannes Horner
  • Eilon Solan
  • Satoru Takahashi

Abstract

We apply Blackwell optimality to repeated games. An equilibrium whose strategy profile is sequentially rational for all high enough discount factors simultaneously is a Blackwell (subgame-perfect, perfect public, etc.) equilibrium. The bite of this requirement depends on the monitoring structure. Under perfect monitoring, a ``folk'' theorem holds relative to an appropriate notion of minmax. Under imperfect public monitoring, absent a public randomization device, any perfect public equilibrium generically involves pure action profiles or stage-game Nash equilibria only. Under private conditionally independent monitoring, in a class of games that includes the prisoner's dilemma, the stage-game Nash equilibrium is played in every round.

Suggested Citation

  • Costas Cavounidis & Sambuddha Ghosh & Johannes Horner & Eilon Solan & Satoru Takahashi, 2025. "Blackwell Equilibrium in Repeated Games," Papers 2501.05481, arXiv.org.
    • Handle: RePEc:arx:papers:2501.05481
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    References listed on IDEAS

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