Commitment and observability in a contracting environment

• 成果类型: Article
• 署名作者: Bhaskar, V.
• 署名单位: University of London; University College London
• 刊物名称: GAMES AND ECONOMIC BEHAVIOR
• ISSN/ISSBN: 0899-8256
• DOI: 10.1016/j.geb.2008.08.003
• 发表日期: 2009
• 页码: 708-720
• 关键词: commitment; Imperfect observation; Mixed strategies; Pricing games

摘要

This paper examine,,.,, leader-follower games where a leader must purchase an essential input from a price-setting supplier in order to take an action. We show that equilibrium outcomes when the followers perfectly observe the leaders' actions cannot be approximated by mixed equilibrium outcomes of the game where followers imperfectly observe the leaders' actions, i.e. they are not accessible. Accessibility fails since in a pure strategy equilibrium, a supplier makes positive profits; however in an equilibrium where a leader randomizes, supplier profits must be zero. Our result follows from a generalized indifference principle that mixed strategies must satisfy in economic environments. While supplier profits cannot be approximated, player action profiles are accessible. Our results also apply to games with costly observation. (C) 2008 Elsevier Inc. All rights reserved.