Reputation in Long-Run Relationships
We model a long-run relationship as an infinitely repeated game played by two equally patient agents. In each period, the agents play an extensive-form game of perfect information. There is incomplete information about the type of player 1 while player 2’s type is commonly known. We show that a sufficiently patient player 1 can leverage player 2’s uncertainty about his type to secure his highest payoff in any perfect Bayesian equilibrium of the repeated game.
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| Date of creation: | 01 Dec 2009 |
| Handle: | RePEc:nwu:cmsems:1507 |
| Contact details of provider: | Postal: Center for Mathematical Studies in Economics and Management Science, Northwestern University, 580 Jacobs Center, 2001 Sheridan Road, Evanston, IL 60208-2014 Phone: 847/491-3527 Fax: 847/491-2530 Web page: http://www.kellogg.northwestern.edu/research/math/ Email: More information through EDIRC
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References listed on IDEAS
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