How the value of information shapes the value of commitment or why the value of commitment does not vanish

Arbeitspapier

This paper challenges recent results on the fragility of the value of commitment. It introduces a specific notion of the 'value of information' for a later-moving player about the action choice of a previously-moving player, gives conditions under which this value is positive and shows that a positive value of information for the latermoving player is sufficient for a positive value of commitment for the previouslymoving player. It then argues that the value of information for a later-moving player is unlikely to vanish in real-world applications, implying that the value of commitment for the previously-moving player does not vanish either.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Working Papers in Economics and Statistics ; No. 2014-03

Classification and Topics

• Classification: Wirtschaft ; Noncooperative Games ; Asymmetric and Private Information; Mechanism Design ; Search; Learning; Information and Knowledge; Communication; Belief; Unawareness ; Oligopoly and Other Imperfect Markets
• Subject: Value of Information ; Value of Commitment ; Sequential Move Game ; Imperfect Observability ; Stackelberg Duopoly ; First-Mover Advantage

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Hörtnagl, Tanja ; Kerschbamer, Rudolf
• Event: Veröffentlichung
• (who): University of Innsbruck, Research Platform Empirical and Experimental Economics (eeecon)
• (where): Innsbruck
• (when): 2014

Further information

• Handle: http://hdl.handle.net/10419/101088
• Last update: 10.03.2025, 11:44 AM CET