Robust Deviations from Signaling Equilibria

Peter Eso () and James Schummer

No 1406, Discussion Papers from Northwestern University, Center for Mathematical Studies in Economics and Management Science

Abstract: In Sender-Receiver games with costly signaling, some equilibria are vulnerable to deviations which could be "unambiguously" interpreted by the Receiver as coming from a unique set of possible Sender-types. The vulnerability occurs when the types in this set are the ones who gain from the deviation, regardless of the posterior beliefs the Receiver forms over that set. We formalize this idea and use it to characterize a unique equilibrium outcome in two classes of games. First, in mono- tonic signaling games, only the Riley outcome is immune to this sort of deviation. Our result therefore provides a plausible story behind the selection made by Cho and Kreps' (1987) D1 criterion on this class of games. Second, we examine a version of Crawford and Sobel's (1982) model but with costly signaling and finite type sets, where standard refinements have no effect. We show that only a Riley-like separating equilibrium is immune to these deviations.

Keywords: Signaling games; Sender-Receiver; robust equilibrium; re¯nements. (search for similar items in EconPapers)
JEL-codes: C70 C72 (search for similar items in EconPapers)
Date: 2005-10
New Economics Papers: this item is included in nep-gth
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.kellogg.northwestern.edu/faculty/schummer/ftp/research/refine/CDC.pdf main text (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:nwu:cmsems:1406

Ordering information: This working paper can be ordered from

Access Statistics for this paper

More papers in Discussion Papers from Northwestern University, Center for Mathematical Studies in Economics and Management Science Center for Mathematical Studies in Economics and Management Science, Northwestern University, 580 Jacobs Center, 2001 Sheridan Road, Evanston, IL 60208-2014. Contact information at EDIRC.
Bibliographic data for series maintained by Fran Walker ( this e-mail address is bad, please contact ).