Probalistic cheap talk

Chakravorti, B., Conley, J. and Taub, B. (2002) Probalistic cheap talk. Social Choice and Welfare, 19(2), pp. 281-294. (doi: 10.1007/s003550100111)

Abstract

We consider a model in which there is uncertainty over when a one-shot game will be played. We show how a mechanism designer can implement desirable outcomes in certain economic games by manipulating only the probability that the game is played in a given round while leaving all other aspects of the game unchanged. We also show that if there is no discounting, this uncertainty imparts a sequential structure that is almost mathematically equivalent to a repeated version of the game with discounting. In particular, a folk theorem applies to such games. Thus, games of probabilistic cheap provide a third interpretation of the repeated game framework with the additional feature that expected payoff is invariant to the probability of the game ending.

• Item Type: Articles
• Status: Published
• Refereed: Yes
• Glasgow Author(s) Enlighten ID: Taub, Professor Bart
• Authors: Chakravorti, B., Conley, J., and Taub, B.
• College/School: College of Social Sciences > Adam Smith Business School > Economics
• Journal Name: Social Choice and Welfare
• ISSN: 0176-1714
• ISSN (Online): 1432-217X