Search results for "C72"
showing 10 items of 14 documents
Codification schemes and finite automata
2000
This paper is a note on how Information Theory and Codification Theory are helpful in the computational design both of communication protocols and strategy sets in the framework of finitely repeated games played by boundedly rational agents. More precisely, we show the usefulness of both theories to improve the existing automata bounds of Neyman¿s (1998) work on finitely repeated games played by finite automata.
Collusion Constrained Equilibrium
2018
First published: 01 February 2018 This is an open access article licensed under the Creative Commons Attribution-NonCommercial License 4.0 (http://econtheory.org) We study collusion within groups in noncooperative games. The primitives are the preferences of the players, their assignment to nonoverlapping groups, and the goals of the groups. Our notion of collusion is that a group coordinates the play of its members among different incentive compatible plans to best achieve its goals. Unfortunately, equilibria that meet this requirement need not exist. We instead introduce the weaker notion of collusion constrained equilibrium. This allows groups to put positive probability on alternatives …
Multiproduct trading with a common agent under complete information: Existence and characterization of Nash equilibrium
2014
This paper focuses on oligopolistic markets in which indivisible goods are sold by multiproduct firms to a continuum of homogeneous buyers, with measure normalized to one, who have preferences over bundles of products. Our analysis contributes to the literature on private, delegated agency games with complete information, extending the insights by Chiesa and Denicolò (2009) to multiproduct markets with indivisibilities and where the agent's preferences need not be monotone. By analyzing a kind of extended contract schedules -mixed bundling prices- that discriminate on exclusivity, the paper shows that efficient equilibria always exist in such settings. There may also exist inefficient equil…
Nash codes for noisy channels
2012
This paper studies the stability of communication protocols that deal with transmission errors. We consider a coordination game between an informed sender and an uninformed decision maker, the receiver, who communicate over a noisy channel. The sender's strategy, called a code, maps states of nature to signals. The receiver's best response is to decode the received channel output as the state with highest expected receiver payoff. Given this decoding, an equilibrium or "Nash code" results if the sender encodes every state as prescribed. We show two theorems that give sufficient conditions for Nash codes. First, a receiver-optimal code defines a Nash code. A second, more surprising observati…
With whom to merge? A tale of the Spanish banking deregulation process
2010
We propose a spatial competition model to study banks’ strategic responses to the asymmetric Spanish geographic deregulation process. We find that once the geographic deregulation process finishes, inter-regional mergers between savings banks are optimal whenever the economies of scale associated to merging activities are low. If there are large gains, then there will be mergers between savings and commercial banks.
Endogenous R&D Symmetry in Linear Duopoly with One-way Spillovers
2005
A duopoly model of cost reducing R&D-Cournot market competition is extended to encompass endogenous timing of R&D investments. Under the assumption that R&D spillovers are zero under simultaneous choices of R&D and only flow from the R&D leader to the follower under sequential choices, sequential and simultaneous play at the R&D stage are compared in order to assess the role of technological externalities in stimulating or attenuating endogenous firm asymmetry. The only timing structure of the R&D stage sustainable as subgame–perfect Nash equilibrium involves simultaneous play and thus zero spillovers.
Conflict and segregation in networks: An experiment on the interplay between individual preferences and social influence
2016
We examine the interplay between a person's individual preference and the social influence others exert. We provide a model of network relationships with conflicting preferences, where individuals are better off coordinating with those around them, but where not all have a preference for the same action. We test our model in an experiment, varying the level of conflicting preferences between individuals. Our findings suggest that preferences are more salient than social influence, under conflicting preferences: subjects relate mainly with others who have the same preferences. This leads to two undesirable outcomes: network segregation and social inefficiency. The same force that helps peopl…
Entry with two correlated signals : the case of industrial espionage and its positive competitive effects
2021
Recent advances in information and communication technologies have increased the incentives for firms to acquire information about rivals. These advances may have major implications for market entry because they make it easier for potential entrants to gather valuable information about, for example, an incumbent’s cost structure. However, little theoretical research has actually analyzed this question. This paper advances the literature by extending a one-sided asymmetric information version of Milgrom and Roberts’ (1982) limit pricing model. Here, the entrant is allowed access to an intelligence system (IS) of a certain precision that generates a noisy signal on the incumbent’s cost struct…
Heterogeneous network games: Conflicting preferences
2013
Proceeding at: 2nd Annual UECE Lisbon Meeting: Game Theory and Applications, took place 2010, November, 4-6, in Lisbon (Portugal). The event Web site http://pascal.iseg.utl.pt/~uece/lisbonmeetings2010/ In many economic situations, a player pursues coordination or anti-coordination with her neighbors on a network, but she also has intrinsic preferences among the available options. We here introduce a model which allows to analyze this issue by means of a simple framework in which players endowed with an idiosyncratic identity interact on a social network through strategic complements or substitutes. We classify the possible types of Nash equilibria under complete information, finding two thr…
Self-enforcing international environmental agreements revisited
2004
In Barrett's (1994) paper on transboundary pollution abatement is shown that if the signatories of an international environmental agreement act in a Stackelberg fashion, then, depending on parameter values, a self-enforcing IEA can have any number of signatories between two and the grand coalition. Barrett obtains this result using numerical simulations and also ignoring the fact that emissions must be non-negative. Recent attempts to use analytical approaches and to explicitly recognize the non-negativity constraints have suggested that the number of signatories of a stable IEA may be very small. The way such papers have dealt with non-negativity constraints is to restrict parameter values…