Credible deviations from signaling equilibria

Arbeitspapier

In games with costly signaling, some equilibria are vulnerable to deviations which could be unambiguously interpreted as coming from a unique set of Sender-types. This occurs when these types are precisely the ones who gain from deviating for any beliefs the Re-ceiver could form over that set. We show that this idea characterizes a unique equilibrium outcome in two classes of games. First, in mono-tonic signaling games, only the Riley outcome is immune to this sort of deviation. Our result therefore provides a plausible story behind the selection made by Cho and Kreps' (1987) D1 criterion on this class of games. Second, we examine a version of Crawford and Sobel's (1982) model with costly signaling, where standard refinements have no effect. We show that only a Riley-like separating equilibrium is immune to these deviations.

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• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Discussion Paper ; No. 1406

Classification and Topics

• Classification: Wirtschaft ; Game Theory and Bargaining Theory: General ; Noncooperative Games
• Subject: Signaling games ; Sender-Receiver ; robust equilibrium ; refinements. ; Nichtkooperatives Spiel ; Signalling ; Spieltheorie ; Theorie

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Eső, Péter ; Schummer, James
• Event: Veröffentlichung
• (who): Northwestern University, Kellogg School of Management, Center for Mathematical Studies in Economics and Management Science
• (where): Evanston, IL
• (when): 2005

Further information

• Handle: http://hdl.handle.net/10419/31230