Sequential commitment games

Itai Arieli, Yakov Babichenko and Moshe Tennenholtz

Games and Economic Behavior, 2017, vol. 105, issue C, 297-315

Abstract: We consider an extensive-form game in which players have the option to commit to actions before the game is played. We focus on commitment procedures where players make voluntary irreversible commitments in a prescribed order over the decision nodes. We study whether such commitment procedures may lead to Pareto-efficient outcomes. Our main result is surprisingly positive: for two-player games, we introduce an order over the decision nodes for which the unique subgame perfect equilibrium outcome is Pareto-efficient for every strict preference of the players over the outcomes. We show that the above result does not hold for games with four players.

Keywords: Commitment games; Extensive-form games; Pareto efficiency (search for similar items in EconPapers)
JEL-codes: C72 D82 (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:gamebe:v:105:y:2017:i:c:p:297-315

DOI: 10.1016/j.geb.2017.08.009

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