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Bayes Correlated Equilibrium and the Comparison of Information Structures in Games

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Abstract

The set of outcomes that can arise in Bayes Nash equilibria of an incomplete information game where players may have access to additional signals beyond the given information structure is equivalent to the set of a version of incomplete information correlated equilibrium which we dub Bayes correlated equilibrium. A game of incomplete information can be decomposed into a basic game, given by actions sets and payoff functions, and an information structure. We identify a partial order on many player information structures (individual sufficiency) under which more information shrinks the set of Bayes correlated equilibria.

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  • Dirk Bergemann & Stephen Morris, 2013. "Bayes Correlated Equilibrium and the Comparison of Information Structures in Games," Cowles Foundation Discussion Papers 1909RR, Cowles Foundation for Research in Economics, Yale University, revised Oct 2014.
    • Handle: RePEc:cwl:cwldpp:1909rr
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    1. Andrew Caplin & Daniel Martin, 2015. "A Testable Theory of Imperfect Perception," Economic Journal, Royal Economic Society, vol. 125(582), pages 184-202, February.
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    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Correlated equilibrium; Incomplete information; Robust predictions; Information structure; Sufficiency; Blackwell ordering;
    All these keywords.

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness

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