On extensive form implementation of contracts in differential information economies

Dionysius Glycopantis, Allan Muir and Nicholas C. Yannelis

Economic Theory, 2003, vol. 21, issue 2, 495-526

Abstract: In the context of differential information economies, with and without free disposal, we consider the concepts of Radner equilibrium, rational expectations equilibrium, private core, weak fine core and weak fine value. We look into the possible implementation of these concepts as perfect Bayesian or sequential equilibria of noncooperative dynamic formulations. We construct relevant game trees which indicate the sequence of decisions and the information sets, and explain the rules for calculating ex ante expected payoffs. The possibility of implementing an allocation is related to whether or not it is incentive compatible. Implementation through an exogenous third party or an endogenous intermediary is also considered. Copyright Springer-Verlag Berlin Heidelberg 2003

Keywords: Keywords and Phrases: Differential information economy; Private core; Radner equilibrium; Rational expectations equilibrium; Weak fine core; Weak fine value; Free disposal; Coalitional Bayesian incentive compatibility; Game trees; Perfect Bayesian equilibrium; Sequential equilibrium; Contracts.; JEL Classification Numbers: 020; 226. (search for similar items in EconPapers)
Date: 2003
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Citations: View citations in EconPapers (35)

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DOI: 10.1007/s00199-002-0299-2

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