 Super- and submodularity of stopping games with random observationsEconomic Theory, 2020, vol. 70, issue 4, No 4, 983-1022 Abstract: Abstract Models of learning and experimentation based on two-armed Poisson bandits addressed several important aspects related to strategic and motivational learning, but they are not suitable to study effects that accumulate over time. We propose a new class of models of strategic experimentation which are almost as tractable as exponential models, but incorporate such realistic features as dependence of the expected rate of news arrival on the time elapsed since the start of an experiment. In these models, the experiment is stopped before news is realized whenever the rate of arrival of news reaches a critical level. This leads to longer experimentation times for experiments with possible breakthroughs than for equivalent experiments with failures. We also show that the game with conclusive failures is supermodular, and the game with conclusive breakthroughs is submodular. Keywords: Stopping games; Supermodular games; Time-inhomogeneous Poisson process (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:spr:joecth:v:70:y:2020:i:4:d:10.1007_s00199-019-01198-4 Ordering information: This journal article can be ordered from DOI: 10.1007/s00199-019-01198-4 Access Statistics for this article Economic Theory is currently edited by Nichoals Yanneils More articles in Economic Theory from Springer, Society for the Advancement of Economic Theory (SAET) Contact information at EDIRC. |
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