Arbeitspapier

Testable implications of multiple equilibria in discrete games with correlated types

We study testable implications of multiple equilibria in discrete games with incomplete information. Unlike de Paula and Tang (2012), we allow the players' private signals to be correlated. In static games, we leverage independence of private types across games whose equilibrium selection is correlated. In dynamic games with serially correlated discrete unobserved heterogeneity, our testable implication builds on the fact that the distribution of a sequence of choices and states are mixtures over equilibria and unobserved heterogeneity. The number of mixture components is a known function of the length of the sequence as well as the cardinality of equilibria and unobserved heterogeneity support. In both static and dynamic cases, these testable implications are implementable using existing statistical tools.

Language
Englisch

Bibliographic citation
Series: cemmap working paper ; No. CWP56/20

Classification
Wirtschaft

Event
Geistige Schöpfung
(who)
Áureo de Paula
Tang, Xun
Event
Veröffentlichung
(who)
Centre for Microdata Methods and Practice (cemmap)
(where)
London
(when)
2020

DOI
doi:10.47004/wp.cem.2020.5620
Handle
Last update
10.03.2025, 11:46 AM CET

Data provider

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Object type

  • Arbeitspapier

Associated

  • Áureo de Paula
  • Tang, Xun
  • Centre for Microdata Methods and Practice (cemmap)

Time of origin

  • 2020

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