Reputation and Risk in Regimes

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Tác giả: Daniel Luo

Ngôn ngữ: eng

Ký hiệu phân loại: 709.17 Historical, geographic, persons treatment of fine and decorative arts

Thông tin xuất bản: 2024

Mô tả vật lý:

Bộ sưu tập: Báo, Tạp chí

ID: 202475

How valuable is reputation to a regime seeking to deter uprisings? I show the answer depends almost entirely on players' strategic uncertainty over other players actions. Without higher-order uncertainty, reputational effects are overshadowed by stage-game strategic complementarities: any payoff attainable in the complete-information repeated game remains attainable in the corresponding reputation game. However, when agents face globalized uncertainty over their payoffs, the regime's value for reputation rises sharply. In particular, the regime can leverage globalized strategic uncertainty to successful develop a reputation and secure their Stackelberg payoff in all pure equilibria of the reputation game, even as that same globalized strategic uncertainty forces them to their minimax payoff in the associated complete-information repeated game. Moreover, the globalized reputation game selects a unique pooling Markov equilibria among the continuum of Markov equilibria present in the complete-information game, refining predictions about equilibrium play. To establish these results, I develop new tools for analyzing non-normalized discounted repeated games with endogenous exit, where commitment actions vary with the regime's patience.
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