JSTOR
Displaying 113 of 13 results

Strategic Information Transmission
This paper develops a model of strategic communication, in which a betterinformed Sender (S) sends a possibly noisy signal to a Receiver (R), who then takes an action that determines the welfare of both. The authors characterize the set of Bayesian Nash equilibria under standard assumptions, and show that equilibrium...
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Rationalizable Strategic Behavior And The Problem Of Perfection
This paper explores the fundamental problem of what can be inferred about the outcome of a noncooperative game, from the rationality of the players and from the information they possess. The answer is summarized in a solution concept called rationalizability. Strategy profiles that are rationalizable are not always Nash equilibria;...
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An Approach To Communication Equilibrium
The Nash equilibrium concept may be extended gradually when the rules of the game are interpreted in a wider and wider sense, so as to allow preplay or even intraplay communication. A wellknown extension of the Nash equilibrium is Aumann's correlated equilibrium, which depends only on the normal form of...
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Rationalizability, Learning, And Equilibrium In Games With Strategic Complementarities
The authors study a rich class of noncooperative games that includes models of oligopoly competition, macroeconomic coordination failures, arms races, bank runs, technology adoption and diffusion, R&D competition, pretrial bargaining, coordination in teams, and many others. For all these games, the sets of pure strategy Nash equilibria, correlated equilibria, and...
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Asset Prices Under Habit Formation And Catching Up With The Jones
This paper introduces a utility function that nests three classes of utility functions: timeseparable utility functions; "Catching up with the Joneses" utility functions that depend on the consumer's level of consumption relative to the lagged crosssectional average level of consumption; and utility functions that display habit formation. Incorporating this utility...
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Learning By Doing And The Introduction Of New Goods
A dynamic general equilibrium model is developed in which goods are valued according to the characteristics they contain, the set of goods produced in any period is endogenously determined, and learning by doing is the force behind sustained growth. It is shown that the set of produced goods changes in...
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A New Approach To Consumer Theory
The theory of consumer behavior in deterministic situations as set out by, say, Debreu (1959, 1960) or Uzawa (1960) is a thing of great aesthetic beauty, a jewel set in a glass case. The product of a long process of refinement from the nineteenthcentury utility theorists through Slutsky and HicksAllen...
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Growth And Indeterminacy In Dynamic Models With Externalities
The authors study the indeterminacy of equilibria in infinite horizon capital accumulation models with technological externalities. The investigation encompasses models with bounded and unbounded accumulation paths, and models with one and two sectors of production. Under reasonable assumptions they find that equilibria are locally unique in onesector economies. In economies...
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Invariant Distributions And The Limiting Behavior Of Markovian Economic Models
Equilibria in stochastic economic models are often time series which fluctuate in complex ways. But it is sometimes possible to summarize the long run, average characteristics of these fluctuations. For example, if the law of motion determined by economic interactions is Markovian and if the equilibrium time series converges in...
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Ex Ante Randomization In Agency Models
The authors consider how a principal can use randomized strategies in designing optimal contracts in agency settings. They distinguish between ex post randomization (over fee schedules following act selection by the agent) and ex ante randomization (over fee schedules before act selection). They show that ex ante randomization may be...
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International Lending With Moral Hazard And Risk Of Repudiation
In this paper, the author examines the constrained optimal pattern of capital flows between a lender and a borrower in an environment in which there are two impediments to forming contracts. The first impediment to contracting arises from the assumption that lenders cannot observe whether borrowers invest or consume borrowed...
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Rationalizable Strategic Behavior
This paper examines the nature of rational choice in strategic games. Although there are many reasons why an agent might select a Nash equilibrium strategy in a particular game, rationality alone does not require him to do so. A natural extension of widely accepted axioms for rational choice under uncertainty...
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Correlated Equilibrium As An Expression Of Bayesian Rationality
Correlated equilibrium is formulated in a manner that does away with the dichotomy usually perceived between the "Bayesian" and the "Gametheoretic" view of the world. From the Bayesian viewpoint, probabilities should be assignable to everything, including the prospect of a player choosing a certain strategy in a certain game. The...
Provided By JSTOR

Strategic Information Transmission
This paper develops a model of strategic communication, in which a betterinformed Sender (S) sends a possibly noisy signal to a Receiver (R), who then takes an action that determines the welfare of both. The authors characterize the set of Bayesian Nash equilibria under standard assumptions, and show that equilibrium...
Provided By JSTOR

Rationalizable Strategic Behavior And The Problem Of Perfection
This paper explores the fundamental problem of what can be inferred about the outcome of a noncooperative game, from the rationality of the players and from the information they possess. The answer is summarized in a solution concept called rationalizability. Strategy profiles that are rationalizable are not always Nash equilibria;...
Provided By JSTOR

An Approach To Communication Equilibrium
The Nash equilibrium concept may be extended gradually when the rules of the game are interpreted in a wider and wider sense, so as to allow preplay or even intraplay communication. A wellknown extension of the Nash equilibrium is Aumann's correlated equilibrium, which depends only on the normal form of...
Provided By JSTOR

Ex Ante Randomization In Agency Models
The authors consider how a principal can use randomized strategies in designing optimal contracts in agency settings. They distinguish between ex post randomization (over fee schedules following act selection by the agent) and ex ante randomization (over fee schedules before act selection). They show that ex ante randomization may be...
Provided By JSTOR

Asset Prices Under Habit Formation And Catching Up With The Jones
This paper introduces a utility function that nests three classes of utility functions: timeseparable utility functions; "Catching up with the Joneses" utility functions that depend on the consumer's level of consumption relative to the lagged crosssectional average level of consumption; and utility functions that display habit formation. Incorporating this utility...
Provided By JSTOR

Learning By Doing And The Introduction Of New Goods
A dynamic general equilibrium model is developed in which goods are valued according to the characteristics they contain, the set of goods produced in any period is endogenously determined, and learning by doing is the force behind sustained growth. It is shown that the set of produced goods changes in...
Provided By JSTOR

A New Approach To Consumer Theory
The theory of consumer behavior in deterministic situations as set out by, say, Debreu (1959, 1960) or Uzawa (1960) is a thing of great aesthetic beauty, a jewel set in a glass case. The product of a long process of refinement from the nineteenthcentury utility theorists through Slutsky and HicksAllen...
Provided By JSTOR

Growth And Indeterminacy In Dynamic Models With Externalities
The authors study the indeterminacy of equilibria in infinite horizon capital accumulation models with technological externalities. The investigation encompasses models with bounded and unbounded accumulation paths, and models with one and two sectors of production. Under reasonable assumptions they find that equilibria are locally unique in onesector economies. In economies...
Provided By JSTOR

Invariant Distributions And The Limiting Behavior Of Markovian Economic Models
Equilibria in stochastic economic models are often time series which fluctuate in complex ways. But it is sometimes possible to summarize the long run, average characteristics of these fluctuations. For example, if the law of motion determined by economic interactions is Markovian and if the equilibrium time series converges in...
Provided By JSTOR

Rationalizability, Learning, And Equilibrium In Games With Strategic Complementarities
The authors study a rich class of noncooperative games that includes models of oligopoly competition, macroeconomic coordination failures, arms races, bank runs, technology adoption and diffusion, R&D competition, pretrial bargaining, coordination in teams, and many others. For all these games, the sets of pure strategy Nash equilibria, correlated equilibria, and...
Provided By JSTOR

International Lending With Moral Hazard And Risk Of Repudiation
In this paper, the author examines the constrained optimal pattern of capital flows between a lender and a borrower in an environment in which there are two impediments to forming contracts. The first impediment to contracting arises from the assumption that lenders cannot observe whether borrowers invest or consume borrowed...
Provided By JSTOR

Rationalizable Strategic Behavior
This paper examines the nature of rational choice in strategic games. Although there are many reasons why an agent might select a Nash equilibrium strategy in a particular game, rationality alone does not require him to do so. A natural extension of widely accepted axioms for rational choice under uncertainty...
Provided By JSTOR

Correlated Equilibrium As An Expression Of Bayesian Rationality
Correlated equilibrium is formulated in a manner that does away with the dichotomy usually perceived between the "Bayesian" and the "Gametheoretic" view of the world. From the Bayesian viewpoint, probabilities should be assignable to everything, including the prospect of a player choosing a certain strategy in a certain game. The...
Provided By JSTOR