The Robustness of Incomplete Penal Codes in Repeated Interactions

Olivier Gossner ()
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Olivier Gossner: CNRS – CREST, Institut Polytechnique de Paris and Department of Mathematics, London School of Economics.

No 2020-29, Working Papers from Center for Research in Economics and Statistics

Abstract: We study the robustness of equilibria with regards to small payoff perturbations of the dynamic game. We show that complete penal codes, that specify players’ strategies after every history, have only limited robustness. We define incomplete penal codes as partial descriptions of equilibrium strategies and introduce a notion of robustness for incomplete penal codes. We prove a Folk Theorem in robust incomplete codes that generates a Folk Theorem in a class of stochastic games.

Keywords: Repeated games; stochastic games; Folk Theorem; robust equilibrium. (search for similar items in EconPapers)
Pages: 38 pages
Date: 2020-12-09
New Economics Papers: this item is included in nep-cta, nep-gth and nep-mic
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Citations: View citations in EconPapers (1)

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