Document Type
Discussion Paper
Publication Date
4-1-1986
CFDP Number
791
CFDP Pages
34
Abstract
This paper investigates pure strategy sequential equilibria of repeated games with imperfect monitoring. The approach emphasizes the equilibrium value set and the static optimization problems embedded in external equilibria. We characterize these equilibria, and provide computational and comparative statics results. The “self-generation” and “bang-bang” propositions which were at the core of our analysis of optimal cartel equilibria [2], are generalized to asymmetric games and infinite action spaces. New results on optimal implicit reward functions include the necessity (as opposed to sufficiency) of bang-bang functions, and the nature of optimal punishment regions.
Recommended Citation
Abreu, Dilip; Pearce, David G.; and Stacchetti, Ennio, "Toward a Theory of Discounted Repeated Games with Imperfect Monitoring" (1986). Cowles Foundation Discussion Papers. 1034.
https://elischolar.library.yale.edu/cowles-discussion-paper-series/1034