On Signalling and Screening

Anastasios Dosis
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Anastasios Dosis: Essec Business School, Economics Department

No WP1608, ESSEC Working Papers from ESSEC Research Center, ESSEC Business School

Abstract: The two games usually employed to model markets with asymmetries of information are the signalling game and the screening game. In the signalling game, an equilibrium may not be efficient due to the arbitrariness in the off-the-equilibrium-path beliefs. In the screening game, a pure strategy Nash equilibrium may fail to exist because of " cream-skimming " deviations. Perhaps surprisingly, I show how in a game that combines signalling and screening, an equilibrium generically exists and is efficient.

Keywords: efficiency; existence; signalling; screening information economics (search for similar items in EconPapers)
JEL-codes: D82 D86 (search for similar items in EconPapers)
Pages: 13 pages
Date: 2016-02-20
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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