A Dynamic Model of Equilibrium Selection In Signaling Markets

Georg Nöldeke and Larry Samuelson

ELSE working papers from ESRC Centre on Economics Learning and Social Evolution

Keywords: ract: In his work on signaling; Spence proposed a dynamic model of a market in which a buyer revises prices in light of experience and in which sellers; with private information about their types; choose utility-maximizing signals given these prices. We follows Spence's suggestion of introducing perturbations into the resulting dynamic process. In a broad class of markets; our model selects a separating equilibrium outcome if and only if the equilibrium outcome satisfies a version of the undefeated equilibrium concept; whereas a pooling equilibrium outcome is selected if and only if the equilibrium outcome is both undefeated and satisfies D1. (search for similar items in EconPapers)
JEL-codes: C70 C72 D82 D83 (search for similar items in EconPapers)
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Citations: View citations in EconPapers (26)

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Related works:
Journal Article: A Dynamic Model of Equilibrium Selection in Signaling Markets (1997)
Working Paper: A Dynamic Model of Equilibrium Selection in Signaling Markets (1996)
Working Paper: A Dynamic Model of Equilibrium Selection in Signaling Markets (1996)
Working Paper: A Dynamic Model of Equilibrium Selection in Signaling Markets (1995)
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