Document Type
Discussion Paper
Publication Date
9-1-2010
CFDP Number
1772R3
CFDP Revision Date
2016-08-01
CFDP Pages
53
Abstract
We study agents whose expected utility preferences are interdependent for informational or psychological reasons. We characterize when two types can be “strategically distinguished” in the sense that they are guaranteed to behave differently in some finite mechanism. We show that two types are strategically distinguishable if and only if they have different hierarchies of interdependent preferences. The same characterization applies for rationalizability, equilibrium, and any interim solution concept in between. Our results generalize and unify results of Abreu and Matsushima (1992), who characterize strategic distinguishability on fixed finite type spaces, and Dekel, Fudenberg, and Morris (2006), (2007), who characterize strategic distinguishability without interdependent preferences.
Recommended Citation
Bergemann, Dirk; Morris, Stephen; and Takahashi, Satoru, "Interdependent Preferences and Strategic Distinguishability" (2010). Cowles Foundation Discussion Papers. 2112.
https://elischolar.library.yale.edu/cowles-discussion-paper-series/2112