Repeated games with present-biased preferences

• 成果类型: Article
• 署名作者: Chade, Hector; Prokopovych, Pavlo; Smith, Lones
• 署名单位: University of Michigan System; University of Michigan; Arizona State University; Arizona State University-Tempe
• 刊物名称: JOURNAL OF ECONOMIC THEORY
• ISSN/ISSBN: 0022-0531
• DOI: 10.1016/j.jet.2007.06.007
• 发表日期: 2008
• 页码: 157-175
• 关键词: Repeated games; beta-delta preferences; Strotz-Pollak equilibrium; Subgame perfect equilibrium; perfect monitoring

摘要

We study infinitely repeated games with perfect monitoring, where players have beta-delta preferences. We compute the continuation payoff set using recursive techniques and then characterize equilibrium payoffs. We then explore the cost of the present-time bias, producing comparative statics. Unless the minimax outcome is a Nash equilibrium of the stage game, the equilibrium payoff set is not monotonic in beta or delta. Finally, we show how the equilibrium payoff set is contained in that of a repeated game with smaller discount factor. (C) 2007 Elsevier Inc. All rights reserved.