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An Approximative Folk Theorem With Imperfect Private Information

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  • FUDENBERG, D.
  • LEVINE, D.K.

Abstract

This paper studies repeated games in which players are imperfectly informed about the uncertain consequences of their opponents stage game actions. We show that if the game is informationally connected, the set of sequential equilibrium payoffs includes the enforceable mutually punishable set, if the intertemporal criterion is (i) the lim inf time average, or (ii) the limit of ε-equilibria with discount factor δ, and ε → 0 as δ → 1. We also explore the link between these two criterion functions.
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Suggested Citation

  • Fudenberg, D. & Levine, D.K., 1989. "An Approximative Folk Theorem With Imperfect Private Information," Working papers 525, Massachusetts Institute of Technology (MIT), Department of Economics.
  • Handle: RePEc:mit:worpap:525
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    References listed on IDEAS

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    9. Drew Fudenberg & Eric Maskin, 2008. "The Folk Theorem In Repeated Games With Discounting Or With Incomplete Information," World Scientific Book Chapters, in: Drew Fudenberg & David K Levine (ed.), A Long-Run Collaboration On Long-Run Games, chapter 11, pages 209-230, World Scientific Publishing Co. Pte. Ltd..
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    Keywords

    information ; game theory ; economic equilibrium;
    All these keywords.

    JEL classification:

    • I10 - Health, Education, and Welfare - - Health - - - General

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