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On effective minimax payoffs and unequal discounting

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  • Chen, Bo

Abstract

We show that the folk theorem in Wen [Q. Wen (1994), The "Folk Theorem" for repeated games with complete information, Econometrica, 62, 949-954.] may not fully characterize the subgame perfect equilibrium payoff set in a repeated game with unequal discounting, where a player's equilibrium payoff could be strictly less than her effective minimax payoff.

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  • Chen, Bo, 2008. "On effective minimax payoffs and unequal discounting," Economics Letters, Elsevier, vol. 100(1), pages 105-107, July.
    • Handle: RePEc:eee:ecolet:v:100:y:2008:i:1:p:105-107
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    References listed on IDEAS

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    1. Drew Fudenberg & David K. Levine & Satoru Takahashi, 2008. "Perfect public equilibrium when players are patient," World Scientific Book Chapters, in: Drew Fudenberg & David K Levine (ed.), A Long-Run Collaboration On Long-Run Games, chapter 16, pages 345-367, World Scientific Publishing Co. Pte. Ltd..
    2. Drew Fudenberg & Eric Maskin, 2008. "The Folk Theorem In Repeated Games With Discounting Or With Incomplete Information," World Scientific Book Chapters, in: Drew Fudenberg & David K Levine (ed.), A Long-Run Collaboration On Long-Run Games, chapter 11, pages 209-230, World Scientific Publishing Co. Pte. Ltd..
    3. Abreu, Dilip & Dutta, Prajit K & Smith, Lones, 1994. "The Folk Theorem for Repeated Games: A NEU Condition," Econometrica, Econometric Society, vol. 62(4), pages 939-948, July.
    4. Wen, Quan, 1994. "The "Folk Theorem" for Repeated Games with Complete Information," Econometrica, Econometric Society, vol. 62(4), pages 949-954, July.
    5. Ehud Lehrer & Ady Pauzner, 1999. "Repeated Games with Differential Time Preferences," Econometrica, Econometric Society, vol. 67(2), pages 393-412, March.
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    Cited by:

    1. Carmona, Guilherme & Carvalho, Luís, 2016. "Repeated two-person zero-sum games with unequal discounting and private monitoring," Journal of Mathematical Economics, Elsevier, vol. 63(C), pages 131-138.
    2. Herings, P. Jean-Jacques & Meshalkin, Andrey & Predtetchinski, Arkadi, 2017. "A one-period memory folk theorem for multilateral bargaining games," Games and Economic Behavior, Elsevier, vol. 103(C), pages 185-198.
    3. Can, Burak, 2014. "Weighted distances between preferences," Journal of Mathematical Economics, Elsevier, vol. 51(C), pages 109-115.
    4. Daniel Cardona & Antoni Rubí-Barceló, 2016. "Time-Preference Heterogeneity and Multiplicity of Equilibria in Two-Group Bargaining," Games, MDPI, vol. 7(2), pages 1-17, May.
    5. Guéron, Yves & Lamadon, Thibaut & Thomas, Caroline D., 2011. "On the folk theorem with one-dimensional payoffs and different discount factors," Games and Economic Behavior, Elsevier, vol. 73(1), pages 287-295, September.
    6. ,, 2015. "Characterizing the limit set of PPE payoffs with unequal discounting," Theoretical Economics, Econometric Society, vol. 10(3), September.
    7. Chen, Bo & Takahashi, Satoru, 2012. "A folk theorem for repeated games with unequal discounting," Games and Economic Behavior, Elsevier, vol. 76(2), pages 571-581.

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