Stochastic games with hidden states

Artikel

This paper studies infinite-horizon stochastic games in which players observe payoffs and noisy public information about a hidden state each period. We find that, very generally, the feasible and individually rational payoff set is invariant to the initial prior about the state in the limit as the discount factor goes to one. This result ensures that players can punish or reward the opponents via continuation payoffs in a flexible way. Then we prove the folk theorem, assuming that public randomization is available. The proof is constructive, and uses the idea of random blocks to design an effective punishment mechanism.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Journal: Theoretical Economics ; ISSN: 1555-7561 ; Volume: 14 ; Year: 2019 ; Issue: 3 ; Pages: 1115-1167 ; New Haven, CT: The Econometric Society

Classification and Topics

• Classification: Wirtschaft ; Noncooperative Games ; Stochastic and Dynamic Games; Evolutionary Games; Repeated Games
• Subject: Stochastic game ; hidden state ; uniform connectedness ; robust connectedness ; random blocks ; folk theorem

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Yamamoto, Yuichi
• Event: Veröffentlichung
• (who): The Econometric Society
• (where): New Haven, CT
• (when): 2019

Further information

• DOI: doi:10.3982/TE3068
• Handle: http://hdl.handle.net/10419/217089
• Last update: 10.03.2025, 11:41 AM CET