Correlation through bounded recall strategies

Ron Peretz ()

International Journal of Game Theory, 2013, vol. 42, issue 4, 867-890

Abstract: Two agents independently choose mixed m-recall strategies that take actions in finite action spaces A 1 and A 2 . The strategies induce a random play, a 1 , a 2 , . . ., where a t assumes values in A 1 × A 2 . An M-recall observer observes the play. The goal of the agents is to make the observer believe that the play is similar to a sequence of i.i.d. random actions whose distribution is $${Q\in\Delta(A_1\times A_2)}$$ . For nearly every t, the following event should occur with probability close to one: “the distribution of a t+M given a t , . . . , a t+M-1 is close to Q.” We provide a sufficient and necessary condition on m, M, and Q under which this goal can be achieved (for large m). This work is a step in the direction of establishing a folk theorem for repeated games with bounded recall. It tries to tackle the difficulty in computing the individually rational levels (IRL) in the bounded recall setting. Our result implies, for example, that in some games the IRL in the bounded recall game is bounded away below the IRL in the stage game, even when all the players have the same recall capacity. Copyright Springer-Verlag 2013

Keywords: Bounded recall; Concealed correlation; Secret correlation; Folk theorem (search for similar items in EconPapers)
Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

Downloads: (external link)
http://hdl.handle.net/10.1007/s00182-012-0334-x (text/html)
Access to full text is restricted to subscribers.

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:spr:jogath:v:42:y:2013:i:4:p:867-890

Ordering information: This journal article can be ordered from
http://www.springer. ... eory/journal/182/PS2

DOI: 10.1007/s00182-012-0334-x

Access Statistics for this article

International Journal of Game Theory is currently edited by Shmuel Zamir, Vijay Krishna and Bernhard von Stengel

More articles in International Journal of Game Theory from Springer, Game Theory Society
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().