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Seemingly Unrelated Repeated Games

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Author Info
John R. Conlon (University of Mississippi)

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Abstract

Suppose Player A is playing two apparently independent repeated games with two other people, B and C, with A randomly matched, each period, with either B or C. Each dyad maintains the maximum incentive-compatible level of cooperation within the dyad, even if cooperation has broken down in the other dyad. Thus, if A defects against B, say, then C is still willing to cooperate with A to the maximum incentive-compatible degree. Nevertheless, we show that the simple presence of each cooperative relationship can increase the maximum incentive compatible level of cooperation in the other dyad, due to a counterintuitive circular reasoning or “bootstrapping” effect. With more than two relationships, bootstrapping effects alternate with equally counterintuitive reverse bootstrapping effects.

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Publisher Info
Paper provided by EconWPA in its series Game Theory and Information with number 0511004.

Download reference. The following formats are available: HTML (with abstract), plain text (with abstract), BibTeX, RIS (EndNote, RefMan, ProCite), ReDIF
Length: 28 pages
Date of creation: 10 Nov 2005
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Handle: RePEc:wpa:wuwpga:0511004

Note: Type of Document - pdf; pages: 28
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Web page: http://129.3.20.41

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Related research
Keywords: Repeated Games; Random Matching;

Find related papers by JEL classification:
C7 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory
D8 - Microeconomics - - Information, Knowledge, and Uncertainty

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References listed on IDEAS
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  1. Kandori, Michihiro, 1992. "Social Norms and Community Enforcement," Review of Economic Studies, Blackwell Publishing, vol. 59(1), pages 63-80, January. [Downloadable!] (restricted)
  2. Spagnolo, G., 1999. "On Interdependent Supergames: Multimarket Contact, Concavity, and Collusion," Cambridge Working Papers in Economics 9914, Faculty of Economics, University of Cambridge. [Downloadable!]
    Other versions:
  3. Ellison, Glenn, 1994. "Cooperation in the Prisoner's Dilemma with Anonymous Random Matching," Review of Economic Studies, Blackwell Publishing, vol. 61(3), pages 567-88, July. [Downloadable!] (restricted)
  4. Rosenthal, R W, 1979. "Sequences of Games with Varying Opponents," Econometrica, Econometric Society, vol. 47(6), pages 1353-66, November. [Downloadable!] (restricted)
  5. Rotemberg, Julio J & Saloner, Garth, 1986. "A Supergame-Theoretic Model of Price Wars during Booms," American Economic Review, American Economic Association, vol. 76(3), pages 390-407, June. [Downloadable!] (restricted)
  6. Fudenberg, Drew & Kreps, David M, 1987. "Reputation in the Simultaneous Play of Multiple Opponents," Review of Economic Studies, Blackwell Publishing, vol. 54(4), pages 541-68, October. [Downloadable!] (restricted)
  7. Farrell, Joseph & Maskin, Eric, 1989. "Renegotiation in repeated games," Games and Economic Behavior, Elsevier, vol. 1(4), pages 327-360, December. [Downloadable!] (restricted)
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  8. Abreu, Dilip, 1988. "On the Theory of Infinitely Repeated Games with Discounting," Econometrica, Econometric Society, vol. 56(2), pages 383-96, March. [Downloadable!] (restricted)
  9. Sobel, Joel, 1985. "A Theory of Credibility," Review of Economic Studies, Blackwell Publishing, vol. 52(4), pages 557-73, October. [Downloadable!] (restricted)
  10. B. Douglas Bernheim & Michael D. Whinston, 1990. "Multimarket Contact and Collusive Behavior," RAND Journal of Economics, The RAND Corporation, vol. 21(1), pages 1-26, Spring. [Downloadable!] (restricted)
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