1,721,092 research outputs found
The relevance of extrinsic uncertainty
No full textWhen the asset market is incomplete extrinsic risk is effective at competitive equilibrium allocations; this is the case whether commodities are exchanged indirectly, through the exchange of assets, or whether assets serve to transfer revenue and commodities are exchanged in spot markets. Individuals bear extrinsic risk for the benefit of exchanging commodities or transferring revenue in the absence of complete markets for the allocation of intrinsic risk
The determinacy of equilibrium in economies of overlapping generations
No full textLanguage is a powerful coordination device. We generalize the cheap-talk
approach to pre-play communication by way of introducing a meaning correspondence
between messages and actions, and by postulating two axioms
met by natural languages. Players have a lexicographic preference, second to
material payoffs, against deviating from the meaning correspondence. Under
two-sided communication in generic and symmetric n 3 n-coordination games,
a Nash equilibrium component in such a lexicographic communication game is
evolutionarily stable if and only if it results in the unique Pareto efficient outcome
of the underlying game. We extend the analysis to one-sided communication
in arbitrary finite two-player games
Information at equilibrium
No full textIn a game with rational expectations, individuals simultaneously refine their information with the information revealed by the strategies of other individuals. At a Nash equilibrium of a game with rational expectations, the information of individuals is essentially symmetric: the same profile of strategies is also an equilibrium of a game with symmetric information; and strategies are common knowledge. If each player has a veto act, which yields a minimum payoff that no other profile of strategies attains, then the veto profile is the only Nash equilibrium, and it is is an equilibrium with rational expectations and essentially symmetric information; which accounts for the impossibility of speculation. Copyright Springer-Verlag Berlin Heidelberg 2003Keywords and Phrases: Nash equilibrium, Rational expectations, Common knowledge., JEL Classification Numbers: D82.,
Monopolistic quantity rationing
Full text linkBöhm V, Maskin E, Polemarchakis H, Postlewaite A. Monopolistic quantity rationing. The quarterly journal of economics. 1983;98:189-197
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