http://lists.repec.org/mailman/listinfo/nep-gth Game Theory 2009-11-14 Laszlo A. Koczy http://d.repec.org/n?u=RePEc:cwl:cwldpp:1739&r=gth We characterize belief-free equilibria in infinitely repeated games with incomplete information with N \ge 2 players and arbitrary information structures. This characterization involves a new type of individual rational constraint linking the lowest equilibrium payoffs across players. The characterization is tight: we define a set of payoffs that contains all the belief-free equilibrium payoffs; conversely, any point in the interior of this set is a belief-free equilibrium payoff vector when players are sufficiently patient. Further, we provide necessary conditions and sufficient conditions on the information structure for this set to be non-empty, both for the case of known-own payoffs, and for arbitrary payoffs. Johannes Horner, Stefano Lovo, Tristan Tomala 2009-10 Repeated games with incomplete information, Harsanyi doctrine, Belief-free equilibria http://d.repec.org/n?u=RePEc:hal:wpaper:hal-00429293_v1&r=gth Let N be a set of players, C the set of permissible coalitions and G an N-playerstrategic game. A profile is a coalitional-equilibrium if no coalition permissible coalition in C has a unilateral deviation that profits to all its members. Nash-equilibria consider only single player coalitions and Aumann strong-equilibria permit all coalitions to deviate. A new fixed point theorem allows to obtain a condition for the existence of coalitional equilibria that covers Glicksberg for the existence of Nash-equilibria and is related to Ichiishi's condition for the existence of Aumann strong-equilibria. Rida Laraki 2009-11-02 Fixed point theorems, maximum of non-transitive preferences, Nash and strong equilibria, coalitional equilibria http://d.repec.org/n?u=RePEc:fem:femwpa:2009.83&r=gth We study coalitional games where the proceeds from cooperation depend on the entire coalition structure. The coalition structure core (Kóczy, 2007) is a generalisation of the coalition structure core for such games. We introduce a noncooperative, sequential coalition formation model and show that the set of equilibrium outcomes coincides with the recursive core. In order to extend past results to games that are not totally balanced (understood in this special setting) we introduce subgame-consistency that requires perfectness in relevant subgames only, while subgames that are never reached are ignored. László Á. Kóczy 2009-10 Partition Function, Externalities, Implementation, Recursive Core, Stationary Perfect Equilibrium, Time Consistent Equilibrium http://d.repec.org/n?u=RePEc:dgr:umamet:2009026&r=gth We examine the notion of the core when cooperation takes place in a setting with time and uncertainty. We do so in a two-period general equilibrium setting with incomplete markets. Market incompleteness implies that players cannot make all possible binding commitments regarding their actions at different date-events. We unify various treatments of dynamic core concepts existing in the literature. This results in definitions of the Classical Core, the Segregated Core, the Two-stage Core, the Strong Sequential Core, and the Weak Sequential Core. Except for the Classical Core, all these concepts can be defined by requiring absence of blocking in period 0 and at any date-event in period 1. The concepts only differ with respect to the notion of blocking in period 0. To evaluate these concepts, we study three market structures in detail: strongly complete markets, incomplete markets in finance economies, and incomplete markets in settings with multiple commodities. Habis Helga, Herings P. Jean-Jacques 2009 mathematical economics; http://d.repec.org/n?u=RePEc:cwl:cwldpp:1737&r=gth We apply the average cost optimality equation to zero-sum Markov games, by considering a simple game with one-sided incomplete information that generalizes an example of Aumann and Maschler (1995). We determine the value and identify the optimal strategies for a range of parameters. Johannes Horner, Dinah Rosenberg, Eilon Solan, Nicolas Vieille 2009-10 Repeated game with incomplete information, Zero-sum games, Partially observable Markov decision processes http://d.repec.org/n?u=RePEc:jrp:jrpwrp:2009-090&r=gth A unique indivisible commodity with an unknown common value is owned by group of individuals and should be allocated to one of them while compensating the others monetarily. We study the so-called fair division game (Güth, Ivanova-Stenzel, Königstein, and Strobel (2002, 2005)) theoretically and experimentally for the common value case and compare our results to the corresponding common value auction. Whereas symmetric risk neutral Nash equilibria are rather similar for both games, behavior differs strikingly. Implementing auctions and fair division games in the lab in a repeated setting under first- and second-price rule, we find that overall behavior is much more dispersed for the fair division games than for the auctions. Winners' profit margins and shading rates are on average slightly lower for the fair division game. Moreover, we find that behavior in the fair division game separates into extreme over- and underbidding. Alice Becker, Tobias Brünner 2009-11-04 common value auction, winner's curse, fair division game http://d.repec.org/n?u=RePEc:ecl:ucdeco:09-10&r=gth We define generalized extensive-form games which allow for mutual unawareness of actions. We extend Pearce's (1984) notion of extensive-form (correlated) rationalizability to this setting, explore its properties and prove existence. We define also a new variant of this solution concept, prudent rationalizability, which refines the set of outcomes induced by extensive-form rationalizable strategies. Finally, we define the normal form of a generalized extensive-form game, and characterize in it extensive-form rationalizability by iterative conditional dominance. Heifetz, Aviad, Meier, Martin, Schipper, Burkhard C. 2009-05 http://d.repec.org/n?u=RePEc:cwl:cwldpp:1734&r=gth We study the robustness of interim correlated rationalizability to perturbations of higher-order beliefs. We introduce a new metric topology on the universal type space, called uniform weak topology, under which two types are close if they have similar first-order beliefs, attach similar probabilities to other players having similar first-order beliefs, and so on, where the degree of similarity is uniform over the levels of the belief hierarchy. This topology generalizes the now classic notion of proximity to common knowledge based on common p-beliefs (Monderer and Samet (1989)). We show that convergence in the uniform weak topology implies convergence in the uniform strategic topology (Dekel, Fudenberg, and Morris (2006)). Moreover, when the limit is a finite type, uniform-weak convergence is also a necessary condition for convergence in the strategic topology. Finally, we show that the set of finite types is nowhere dense under the uniform strategic topology. Thus, our results shed light on the connection between similarity of beliefs and similarity of behaviors in games. Yi-Chun Chen, Alfredo Di Tillio, Eduardo Faingold, Siyang Xiong 2009-10 Rationalizability, Incomplete information, Higher-order beliefs, Strategic topology, Electronic mail game http://d.repec.org/n?u=RePEc:str:wpaper:0922&r=gth Bilateral oligopoly is a strategic market game with two commodities, allowing strategic behavior on both sides of the market. When the number of buyers is large, such a game approximates a game of quantity competition played by sellers. We present examples which show that this is not typically a Cournot game. Rather, we introduce an alternative game of quantity competition (the market share game) and, appealing to results in the literature on contests, show that this yields the same equilibria as the many-buyer limit of bilateral oligopoly, under standard assumptions on costs and preferences. We also show that the market share and Cournot games have the same equilibria if and only if the price elasticity of the latter is one. These results lead to necessary and su¢ cient conditions for the Cournot game to be a good approximation to bilateral oligopoly with many buyers and to an ordering of total output when they are not satisfied. Alex Dickson, Roger Hartley 2009-10 Quantity competition, Cournot, strategic foundation, commitment http://d.repec.org/n?u=RePEc:hal:cesptp:halshs-00429894_v1&r=gth This paper considers whether earned wealth affects bidding behavior in an induced-value second-price auction. We find people bid more sincerely in the auction with earned wealth given monetary incentives; earned wealth did not induce sincere bidding in hypothetical auctions. Nicolas Jacquemet, Robert-Vincent Joule, Stephane Luchini, Jason Shogren 2009 Auctions; Demand revelation; Experimental valuation; Hypothetical bias; Earned money http://d.repec.org/n?u=RePEc:ulp:sbbeta:2009-31&r=gth A group of firms consider collaborating on a project which requires a combination of elements which are owned by some of them. These elements are nonrival but excludable goods i.e. public goods with exclusion like for instance knowledge, data or informations, patents or copyrights. We address the question of how firms should be compensated for the goods they own. We shown that this problem can be framed as a cost sharing game to which standard allocation rules like the Shapley value, the nucleolus or accountings formulas can be applied and compared. Our analysis is inspired by the need for a cooperation between European chemical firms within the regulation program REACH which requires them to submit by 2018 a detailed analysis of the substances they produce or import. Pierre Dehez, Daniela Tellone 2009 cost sharing, Shapley value, core, nucleolus. http://d.repec.org/n?u=RePEc:ieb:wpaper:2009/10/doc2009-27&r=gth Thinking of electoral rules, common wisdom suggests that proportional rule is more fair, since all voters are equally represented: at times, it turns out that this is false. I study the formation of both Parliament and Government; for the composition of the former I consider plurality and proportional rule; for the formation of the latter, I assume that parties play a non-cooperative game `a la Rubinstein. I show that, unless parties are impatient to form a Government, proportional electoral rules translate into a more distortive distribution of power among parties than plurality rule; this happens because of the bargaining power of small parties during Government formation. Amedeo Piolatto 2009 Electoral systems, proportional rule, plurality rule, voters’ representation http://d.repec.org/n?u=RePEc:mal:wpaper:2009-7&r=gth We investigate the implications and logical relations between progressivity (a principle of distributive justice) and merging-proofness (a strategic principle) in taxation. By means of two characterization results, we show that these two principles are intimately related, despite their different nature. In particular, we show that, in the presence of continuity and consistency (a widely accepted framework for taxation) progressivity implies merging-proofness and that the converse implication holds if we add an additional strategic principle extending the scope of merging-proofness to a multilateral setting. By considering operators on the space of taxation rules, we also show that progressivity is slightly more robust than merging-proofness. Biung-Ghi Ju, Juan D. Moreno-Ternero 2009-11 taxation, progressivity, merging-proofness, consistency, operators http://d.repec.org/n?u=RePEc:fem:femwpa:2009.90&r=gth This paper analyses the effects on economic agents' behaviour of an innovative environmental protection mechanism that the Public Administration of a tourist region may adopt to attract visitors while protecting the environment. On the one hand, the Public Administration sells to the tourists an environmental call option that gives them the possibility of being (partially or totally) reimbursed if the environmental quality in the region turns out to be below a given threshold level. On the other hand, it offers the firms that adopt an innovative, non-polluting technology an environmental put option that allows them to get a reimbursement for the additional costs imposed by the new technology if the environmental quality is above the threshold level. The aim of the paper is to study the dynamics that arise with this financial mechanism from the interaction between the economic agents and the Public Administration in an evolutionary game context. Simone Borghesi, Angelo Antoci, Marcello Galeotti 2009-10 Environmental Bonds, Call and Put Options, Technological Innovation, Evolutionary Dynamics