Equilibrium selection in signaling games with teams: Forward induction or faster adaptive learning?

2009 ◽  
Vol 63 (4) ◽  
pp. 216-224 ◽  
Author(s):  
David J. Cooper ◽  
John H. Kagel
Keyword(s):  
Adaptive Learning ◽  
Equilibrium Selection ◽  
Signaling Games ◽  
Forward Induction

scholarly journals Equilibrium Selection in Signaling Games

Econometrica ◽  
1987 ◽  
Vol 55 (3) ◽  
pp. 647 ◽  
Author(s):  
Jeffrey S. Banks ◽  
Joel Sobel
Keyword(s):  
Equilibrium Selection ◽  
Signaling Games

scholarly journals RATIONALIZATION IN SIGNALING GAMES: THEORY AND APPLICATIONS

2006 ◽  
Vol 08 (01) ◽  
pp. 67-93 ◽  
Author(s):  
PIERPAOLO BATTIGALLI
Keyword(s):  
Iterative Solution ◽  
Signaling Games ◽  
Forward Induction ◽  
Full Disclosure ◽  
Multistage Games ◽  
Different Types ◽  
Games With Incomplete Information ◽  
Job Market Signaling ◽  
Games Theory ◽  
Separating Equilibrium

Focusing on signaling games, I illustrate the relevance of the rationalizability approach for the analysis multistage games with incomplete information. I define a class of iterative solution procedures, featuring a notion of "forward induction": the Receiver tries to explain the Sender's message in a way which is consistent with the Sender's strategic sophistication and certain given restrictions on beliefs. The approach is applied to some numerical examples and economic models. In a standard model with verifiable messages a full disclosure result is obtained. In a model of job market signaling the best separating equilibrium emerges as the unique rationalizable outcome only when the high and low types are sufficiently different. Otherwise, rationalizability only puts bounds on the education choices of different types.

E-STABILITY DOES NOT IMPLY LEARNABILITY

2005 ◽  
Vol 9 (2) ◽  
pp. 276-287 ◽  
Author(s):  
CHRYSSI GIANNITSAROU
Keyword(s):  
Adaptive Learning ◽  
Rational Expectations ◽  
Equilibrium Selection ◽  
Macroeconomic Dynamics

The concept of E-stability is widely used as a learnability criterion in studies of macroeconomic dynamics with adaptive learning. In this paper, it is demonstrated, via a counterexample, that E-stability generally does not imply learnability of rational expectations equilibria. The result indicates that E-stability may not be a robust device for equilibrium selection.

scholarly journals Delegation Using Forward Induction

2021 ◽  
pp. 2150022
Author(s):  
Swagata Bhattacharjee
Keyword(s):  
Asymmetric Information ◽  
Equilibrium Selection ◽  
Coordination Game ◽  
Principal Agent ◽  
Laboratory Setting ◽  
Forward Induction ◽  
Bayesian Games ◽  
Agent Model ◽  
Induction Argument ◽  
Principal Agent Model

This paper explores how delegation can be used as a signal to sustain cooperation. I consider a static principal–agent model with two tasks, one resembling a coordination game. If there is asymmetric information about the agent’s type, the principal with high private belief can delegate the first task as a signal. This is also supported by the forward induction argument. However, in the laboratory setting, this equilibrium is chosen only sometimes. When the subjects have information about past sessions, there is a significant increase in the use of delegation. This finding sheds light on equilibrium selection in Bayesian games.

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