Belief-Based Equilibria in the Repeated Prisoners' Dilemma with Private Monitoring

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Belief-Based Equilibria in the Repeated Prisoners' Dilemma with Private Monitoring

We analyze in...nitely repeated prisoners’ dilemma games with imperfect private monitoring, and construct sequential equilibria where strategies are measurable with respect to players’ beliefs regarding their opponents’ continuation strategies. We show that, when monitoring is almost perfect, the symmetric e¢cient outcome can be approximated in any prisoners’ dilemma game, while every individua...

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Sequential Equilibria in the Repeated Prisoners’ Dilemma with Private Monitoring

We analyze the infinitely repeated prisoners’ dilemma with imperfect private monitoring. The efficient outome can be approximated in any prisoners’ dilemma game, while every individually rational feasible payoff can be approximated in a class of prisoner dilemma games. Our results require that monitoring be sufficiently accurate but do not require very low discounting.

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The belief-based approach for repeated games with private monitoring studies an important class of strategies where at each point of the game, each player’s optimal continuation strategy is determined by the player’s beliefs of the private state of the opponents. This paper extends the belief-based approach to the repeated prisoners’dilemma with asymmetric private monitoring. We …rst …nd that t...

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Repeated games with imperfect private monitoring have a wide range of applications, but a complete characterization of all equilibria in this class of games has yet to be obtained. The existing literature has identified a relatively tractable subset of equilibria. The present paper introduces the notion of weakly belief-free equilibria for repeated games with imperfect private monitoring. This ...

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ژورنال

عنوان ژورنال: Journal of Economic Theory

سال: 2002

ISSN: 0022-0531

DOI: 10.1006/jeth.2001.2878