Uniformly Strict Equilibrium for Repeated Games with Private Monitoring and Communication

Richard McLean, Ichiro Obara and Andrew Postlewaite

PIER Working Paper Archive from Penn Institute for Economic Research, Department of Economics, University of Pennsylvania

Abstract: Cooperation through repetition is an important theme in game theory. In this regard, various celebrated \folk theorems" have been proposed for repeated games in increasingly more complex environments. There has, however, been insufficient attention paid to the robustness of a large set of equilibria that is needed for such folk theorems. Starting with perfect public equilibrium as our starting point, we study uniformly strict equilibria in repeated games with private monitoring and direct communication (cheap talk). We characterize the limit equilibrium payoff set and identify the conditions for the folk theorem to hold with uniformly strict equilibrium.

Keywords: Cheap Talk; Communication; Folk theorem; Private monitoring; Repeated games; Robustness; Strict Equilibrium (search for similar items in EconPapers)
JEL-codes: C72 C73 D82 (search for similar items in EconPapers)
Pages: 21 pages
Date: 2023-10-31
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Working Paper: Uniformly Strict Equilibrium for Repeated Games with Private Monitoring and Communication (2024)
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