Ambiguity and the centipede game: strategic uncertainty in multi-stage games
We propose a solution concept for a class of extensive form games with ambiguity. Specifically we consider multi-stage games. Players have CEU preferences. The associated ambiguous beliefs are revised by Generalized Bayesian Updating. We assume individuals take account of possible changes in their p...
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| Main Authors: | , , |
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| Format: | Book/Monograph Working Paper |
| Language: | English |
| Published: |
Heidelberg
University of Heidelberg, Department of Economics
15th August 2017
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| Series: | Discussion paper series / University of Heidelberg, Department of Economics
no. 638 |
| In: |
Discussion paper series (no. 638)
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| Subjects: | |
| Online Access: | Resolving-System, kostenfrei, Volltext: http://nbn-resolving.de/urn:nbn:de:bsz:16-heidok-233892 Resolving-System, kostenfrei, Volltext: http://hdl.handle.net/10419/179277 Verlag, kostenfrei, Volltext: http://www.ub.uni-heidelberg.de/archiv/23389 Verlag, kostenfrei, Volltext: http://archiv.ub.uni-heidelberg.de/volltextserver/23389/1/dp638.pdf 
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| Author Notes: | Jürgen Eichberger, Simon Grant and David Kelsey |
| Summary: | We propose a solution concept for a class of extensive form games with ambiguity. Specifically we consider multi-stage games. Players have CEU preferences. The associated ambiguous beliefs are revised by Generalized Bayesian Updating. We assume individuals take account of possible changes in their preferences by using consistent planning. We show that if there is ambiguity in the centipede game it is possible to sustain 'cooperation' for many periods as part of a consistent-planning equilibrium under ambiguity. In a non-cooperative bargaining game we show that ambiguity may be a cause of delay in bargaining. |
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| Item Description: | Aus: Discussion Paper Series / University of Heidelberg, Department of Economics ; 0638 |
| Physical Description: | Online Resource |