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Strategic information transmission: a mathematica tool for analysis

Author

Listed:
  • Dickhaut, John
  • Kaplan, Todd R
  • Mukherji, Arijit

Abstract

Economists and other applied researchers use game theory to study industrial organization, financial markets, and the theory of the firm. In an earlier article in the Mathematica Journal, [Dickhaut and Kaplan 1991] present a procedure for solving two-person games of complete information. In many applications, however, "asymmetric information" is a central issue. By asymmetric information, we mean that one party has access to information that the other party lacks. The branch of game theory that deals with this problem is known as "games of incomplete information"; the formal model is discussed in [Harsanyi 1967]. [Myerson 1991, Tirole 1989] et al, discuss the applications but do not focus on computational procedures. We provide, in this article, an application of Mathematica to games of incomplete information that should be of interest for two reasons: (i) as a basis for thinking about solutions to games of incomplete information, and (ii) as an approach to understanding the particular application presented here, namely, the effect of strategic information transmission in firms and markets.

Suggested Citation

  • Dickhaut, John & Kaplan, Todd R & Mukherji, Arijit, 1992. "Strategic information transmission: a mathematica tool for analysis," MPRA Paper 33869, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:33869
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    File URL: https://mpra.ub.uni-muenchen.de/33869/1/MPRA_paper_33869.pdf
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    References listed on IDEAS

    as
    1. Crawford, Vincent P & Sobel, Joel, 1982. "Strategic Information Transmission," Econometrica, Econometric Society, vol. 50(6), pages 1431-1451, November.
    2. Todd R. Kaplan & John Dickhaut, "undated". "A Program for Finding Nash Equilibria," Working papers _004, University of Minnesota, Department of Economics.
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    More about this item

    Keywords

    Mathematica; Strategic Information Transmission; Crawford Sobel Model;
    All these keywords.

    JEL classification:

    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games

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