Certifiable Dominance: Unique Equilibrium Outcome in Persuasion Games with Binary Actions

2014 ◽  
Author(s):  
Shintaro Miura
Keyword(s):  
Unique Equilibrium ◽  
Equilibrium Outcome ◽  
Persuasion Games

scholarly journals Would depositors pay to show that they do not withdraw? Theory and experiment

2020 ◽  
Vol 23 (3) ◽  
pp. 873-894
Author(s):  
Markus Kinateder ◽  
Hubert János Kiss ◽  
Ágnes Pintér
Keyword(s):  
Multiple Equilibria ◽  
Financial Intermediation ◽  
Type Model ◽  
Unique Equilibrium ◽  
Equilibrium Outcome ◽  
Bank Run ◽  
Public Announcements ◽  
Information Sets ◽  
Theoretical Results ◽  
Theory And Experiment

Abstract In a Diamond–Dybvig type model of financial intermediation, we allow depositors to announce at a positive cost to subsequent depositors that they keep their funds deposited in the bank. Theoretically, the mere availability of public announcements (and not its use) ensures that no bank run is the unique equilibrium outcome. Multiple equilibria—including bank run—exist without such public announcements. We test the theoretical results in the lab and find a widespread use of announcements, which we interpret as an attempt to coordinate on the no bank run outcome. Withdrawal rates in general are lower in information sets that contain announcements.

scholarly journals Entry-Proofness and Discriminatory Pricing under Adverse Selection

2021 ◽  
Vol 111 (8) ◽  
pp. 2623-2659
Author(s):  
Andrea Attar ◽  
Thomas Mariotti ◽  
François Salanié
Keyword(s):  
Adverse Selection ◽  
Sufficient Condition ◽  
Unique Equilibrium ◽  
Necessary And Sufficient Condition ◽  
Recursive Structure ◽  
Equilibrium Outcome ◽  
Balanced Allocation ◽  
Necessary And Sufficient

This paper studies competitive allocations under adverse selection. We first provide a general necessary and sufficient condition for entry on an inactive market to be unprofitable. We then use this result to characterize, for an active market, a unique budget-balanced allocation implemented by a market tariff making additional trades with an entrant unprofitable. Motivated by the recursive structure of this allocation, we finally show that it emerges as the essentially unique equilibrium outcome of a discriminatory ascending auction. These results yield sharp predictions for competitive nonexclusive markets. (JEL D11, D43, D82, D86)

The core of a strategic game

2018 ◽  
Vol 19 (1) ◽  
Author(s):  
Parkash Chander
Keyword(s):  
Partition Function ◽  
Cooperative Game ◽  
Unique Equilibrium ◽  
Strategic Game ◽  
Function Form ◽  
Equilibrium Outcome ◽  
Cooperative Solution ◽  
Payoff Vector ◽  
The Core ◽  
Partition Function Form

AbstractIn this paper, I introduce and study the $\gamma$-core of a general strategic game. I first show that the $\gamma$-core of an arbitrary strategic game is smaller than the conventional $\alpha$- and $\beta$- cores. I then consider the partition function form of a general strategic game and show that a prominent class of partition function games admit nonempty $\gamma$-cores. Finally, I show that each $\gamma$-core payoff vector (a cooperative solution) can be supported as an equilibrium outcome of an intuitive non-cooperative game and the grand coalition is the unique equilibrium outcome if and only if the $\gamma$-core is non-empty.

scholarly journals Policy Experimentation in Committees: A Case against Veto Rights under Redistributive Constraints

2021 ◽  
Vol 13 (3) ◽  
pp. 124-162
Author(s):  
Vincent Anesi ◽  
T. Renee Bowen
Keyword(s):  
Optimal Policy ◽  
Bargaining Game ◽  
Veto Players ◽  
Unique Equilibrium ◽  
Equilibrium Outcome ◽  
Safe Alternative ◽  
Policy Experimentation ◽  
Voting Rule ◽  
Dynamic Bargaining

We study optimal policy experimentation by a committee. We consider a dynamic bargaining game in which committee members choose either a risky reform or a safe alternative each period. When no redistribution is allowed, the unique equilibrium outcome is generically inefficient. When redistribution is allowed (even small amounts), there always exists an equilibrium that supports optimal experimentation for any voting rule without veto players. With veto players, however, optimal policy experimentation is possible only with a sufficient amount of redistribution. We conclude that veto rights are more of an obstacle to optimal policy experimentation than are the constraints on redistribution themselves. (JEL D72, C78, H23, D78, D71)

scholarly journals Bargaining over Risky Assets

2002 ◽  
Vol 2 (1) ◽  
Author(s):  
Muhamet Yildiz
Keyword(s):  
Pareto Optimal ◽  
Unique Equilibrium ◽  
Equilibrium Outcome ◽  
Risky Assets ◽  
Rational Allocation ◽  
Optimal Allocations ◽  
Bargaining Procedure ◽  
Subgame Perfect Equilibria ◽  
Perfect Equilibria ◽  
Pareto Optimal Allocations

We analyze the subgame-perfect equilibria of a game where two agents bargain in order to share the risk in their assets that will pay dividends once at some fixed date. The uncertainty about the size of the dividends is resolved gradually by the payment date and each agent has his own view about how the uncertainty will be resolved. As agents become less uncertain about the dividends, some contracts become unacceptable to some party to such an extent that at the payment date no trade is possible. The set of contracts is assumed to be rich enough to generate all the Pareto-optimal allocations. We show that there exists a unique equilibrium allocation, and it is Pareto-optimal. Immediate agreement is always an equilibrium outcome; under certain conditions, we further show that in equilibrium there cannot be a delay. In this model, the equilibrium shares depend on how the uncertainty is resolved, and an agent can lose when his opponent becomes more risk-averse. Finally, we characterize the conditions under which every Pareto-optimal and individually rational allocation is obtainable via some bargaining procedure as the unique equilibrium outcome.

scholarly journals Revenue Comparison in Asymmetric Auctions with Discrete Valuations

2013 ◽  
Vol 13 (1) ◽  
pp. 429-461 ◽  
Author(s):  
Nicola Doni ◽  
Domenico Menicucci
Keyword(s):  
The Other ◽  
Unique Equilibrium ◽  
Equilibrium Outcome ◽  
Asymmetric Auctions ◽  
First Order ◽  
Reserve Prices ◽  
Revenue Comparison ◽  
Asymmetric Auction ◽  
Price Auction ◽  
Second Price Auction

AbstractWe consider an asymmetric auction setting with two bidders such that the valuation of each bidder has a binary support. First, we characterize the unique equilibrium outcome in the first price auction for any values of parameters. Then we compare the first price auction with the second price auction in terms of expected revenue. Under the assumption that the probabilities of low values are the same for the two bidders, we obtain two main results: (i) the second price auction yields a higher revenue unless the distribution of a bidder’s valuation first-order stochastically dominates the distribution of the other bidder’s valuation “in a strong sense” and (ii) introducing reserve prices implies that the first price auction is never superior to the second price auction. In addition, in some cases, the revenue in the first price auction decreases when all the valuations increase.

scholarly journals Duopoly price competition with limited capacity

2021 ◽  
Author(s):  
A. Bërdëllima
Keyword(s):  
Price Competition ◽  
Small Firms ◽  
Common Knowledge ◽  
Limited Capacity ◽  
Equilibrium Outcome ◽  
Second Stage ◽  
Duopoly Model ◽  
Full Capacity ◽  
Stage Game ◽  
The Given

AbstractWe study a variation of the duopoly model by Kreps and Scheinkman (1983). Firms limited by their capacity of production engage in a two stage game. In the first stage they commit to levels of production not exceeding their capacities which are then made common knowledge. In the second stage after production has taken place firms simultane- ously compete in prices. Solution of this sequential game shows that the unique Cournot equilibrium outcome as in Kreps and Scheinkman is not always guaranteed. However the Cournot outcome is still robust in the sense that given sufficiently large capacities this equilibrium holds. If capacities are sufficiently small, firms decide to produce at their full capacity and set a price which clears the market at the given level of output.

scholarly journals Those who can't sort, steal: caste, occupational mobility, and rent-seeking in rural India

2021 ◽  
Vol 87 (1) ◽  
pp. 107-140
Author(s):  
Nicholas Lawson ◽  
Dean Spears
Keyword(s):  
Labor Markets ◽  
Social Inequality ◽  
Occupational Mobility ◽  
Rent Seeking ◽  
Static Equilibrium ◽  
Rural India ◽  
Equilibrium Outcome ◽  
Stylized Facts ◽  
Survey Question

AbstractThree important features of Indian labor markets enduringly coexist: rent-seeking, occupational immobility, and caste. These facts are puzzling, given theories that predict static, equilibrium social inequality without conflict. Our model explains these facts as an equilibrium outcome. Some people switch caste-associated occupations for an easier source of rents, rather than for productivity. This undermines trust between castes and shuts down occupational mobility, which further encourages rent-seeking due to an inability of workers to sort into occupations. We motivate our contribution with novel stylized facts exploiting a unique survey question on casteism in India, which we show is associated with rent-seeking.

scholarly journals Determinacy of equilibrium outcome distributions for zero sum and common utility games

2012 ◽  
Vol 115 (2) ◽  
pp. 152-154 ◽  
Author(s):  
Cristian M. Litan ◽  
Francisco Marhuenda
Keyword(s):  
Equilibrium Outcome ◽  
Zero Sum
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