Repeated games with present-biased preferences

Hector Chade, Pavlo Prokopovych and Lones Smith

Journal of Economic Theory, 2008, vol. 139, issue 1, 157-175

Abstract: We study infinitely repeated games with perfect monitoring, where players have [beta]-[delta] preferences. We compute the continuation payoff set using recursive techniques and then characterize equilibrium payoffs. We then explore the cost of the present-time bias, producing comparative statics. Unless the minimax outcome is a Nash equilibrium of the stage game, the equilibrium payoff set is not monotonic in [beta] or [delta]. Finally, we show how the equilibrium payoff set is contained in that of a repeated game with smaller discount factor.

Date: 2008
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Citations: View citations in EconPapers (26)

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Related works:
Working Paper: Repeated Games with Present-Biased Preferences (2006)
Working Paper: Repeated Games with Present-Biased Preferences
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Persistent link: https://EconPapers.repec.org/RePEc:eee:jetheo:v:139:y:2008:i:1:p:157-175

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