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Papers on signalling + validation?

Looking to see if there's any game theory literature in which 2+ players play a game of incomplete information. One set of (informed) players gives Spence-like signals to the uninformed player(s). The ...
dazednconfused's user avatar
1 vote
0 answers
51 views

Why did Bergemann and Morris chose a different setting with respect to Kamenica and Gentzkow only to reach to the same results?

Why did Bergemann and Morris choose a different setting with respect to Kamenica and Gentzkow only to reach to the same results? However none of both approaches seem to present the problem in a ...
Oliver Queen's user avatar
2 votes
0 answers
48 views

Kuhn’s equivalence theorem in game theory

I consider a game with two players in incomplete information with perfect recall and I would like to prove Kuhn’s theorem stating that for every mixed strategy $\sigma$ there exists a behavior ...
G2MWF's user avatar
  • 131
1 vote
2 answers
124 views

Unwrapping Kamenica and Gentzkow model

Let's start with the basics. Suppose that $\Theta$ is a finite set of states and $\theta$ is the element of the state set. To simplify the model, we assume that $\Theta = \{\theta_1 = G, \theta_2 = B \...
Oliver Queen's user avatar
2 votes
1 answer
71 views

Beyond quadratic loss preferences?

I have a complex question. Is there any other way to model the preference misalignments of the sendres (in senders-receivers games) towards the desire of some specific state apart from the quadratic ...
Oliver Queen's user avatar
1 vote
1 answer
103 views

Information asymmetry references and it's relation to freemarkets - reference request?

Is there any reading I can do of what information asymmetry can do to free markets?
More Anonymous's user avatar
2 votes
0 answers
27 views

Two questions in Bergemann and Morris (2016) - BCE and Comparison of Information Structures in games

Based on Begemann and Morris (2016) we have the following definition about a standard game of incomplete information A standard game $\Gamma = <G,S>$ of incomplete information consists of a set ...
Oliver Queen's user avatar
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0 answers
74 views

What is the difference between the utility with the ex-post or the ex-ante utility function?

What is the difference of the ex-post utility function of the utility function. For example in Bergemann and Morris (2019) the utility function is defined as an ex-post utility function. Check in page ...
Oliver Queen's user avatar
1 vote
0 answers
13 views

How should assets be valued when there is some private info & informative prices?

Valuation with noisy data and informative prices Suppose everyone in the market for a particular asset has access to some very noisy information from which they can calculate the value of that asset. ...
andrewH's user avatar
  • 345
1 vote
0 answers
20 views

What is the difference among information acquisition, information providing and information design?

Taking a look at the literature of information economics I see three different terminologies about information that seem to have some intersection, though my understanding is not so good. These terms ...
Oliver Queen's user avatar
1 vote
1 answer
151 views

Understanding How to Counter the Winner's Curse

In both popular level books on economics/rationality/etc., and videos of actual economics lectures, I keep running into the suggestion to bid in a common value auction as though victory is already ...
user10478's user avatar
  • 423
4 votes
2 answers
97 views

Any good resources on Information Economics Theory?

I am coming from a political economy/public choice perspective, trying to explore some ideas in signaling, especially the supply-side analysis of information transmission by the media/news. Although I ...
Mwazr A's user avatar
  • 63
2 votes
1 answer
169 views

Bayes’ rule in "The sources of capital misallocation"

I am reading a paper titled "The sources of capital misallocation". In the model, firms are facing incomplete information about their future productivities. In particular, the productivity ...
Seyed Mahdi's user avatar
4 votes
1 answer
627 views

What is the intuition behind Blackwell's Equivalence Theorem on Information Structures?

Let us suppose that we have a Bayesian game where the information structure is defined to be as $P^X=\{(X,\mathcal{X},P_\theta)\}_{\theta\in\Theta}$ where a signal generated by the information ...
Hunger Learn's user avatar
0 votes
0 answers
47 views

Alternative to Investing.com

Do you know of any alternative to Investing.com that allows me to get historical data by editing the URL? What I mean is that in Investing.com in the historical data page I get the form data retrieved ...
Fábio LinharesCPC's user avatar
2 votes
0 answers
32 views

Social learning and diffusion

I'm looking at the literature on information dissemination within networks and came across the concept of diffusion of information in Alatas et al.,2016. The way I understood is diffusion refers to ...
Jan3's user avatar
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1 vote
1 answer
104 views

Mechanisms of communication in game theory

In the spirit of the previous question that I have done, here considering the paper here I am trying to make the matching definition $2.2$ here. I will give two definitions and I would like to clarify ...
Nav89's user avatar
  • 488
4 votes
1 answer
166 views

Difficulty in understanding the notation related from probability theory with game theory

The question that I have is a little technical and it has to do with the notation and the combination between some mathamatical properties in the probability theory of information economics. Say $\...
Nav89's user avatar
  • 488
2 votes
0 answers
40 views

Strategy definition in an extensive form game

How a (pure ) strategy is defined in an extension form game with information sets? I would like to have both an intuitive and a formal definition. Thank you in advance!
Nav89's user avatar
  • 488
3 votes
1 answer
142 views

VCG mechanism and budget balance

I have a general question on how we state that in VCG (which doesn't balance the budget) we can't distribute the money as it will destroy incentives. I don't understand how for ex. this would affect ...
Maybeline Lee's user avatar
4 votes
2 answers
127 views

Olivier Gossner - Secure Protocols or How Communication Generates Correlation

The paper of Olivier Gossner in Security Protocols in 1998 has some definitions that confuse me too much. I will cite here these definitions and my questions and I hope someone is familiar with these ...
Hunger Learn's user avatar
6 votes
1 answer
151 views

Definition of Diffusion Centrality in Banerjee et al. (2019)

I am reading "Using gossips to spread information: Theory and evidence from two Randomised Control Trials" by Banerjee, Chandrashekhar, Duflo and Jackson, where they discuss the efficacy of ...
Ishan Kashyap Hazarika's user avatar
1 vote
0 answers
76 views

Payoffs in games with imperfect information can be different?

I know that a game has imperfect information if there is an nonsingleton information set, and that defines a situation on which a player can't distinguish between the nodes in the information set. ...
jealcalat's user avatar
4 votes
3 answers
164 views

Definiton of information sets in rational expecations models

I am struggling with the notion of 'information sets' in the context of rational expectation models in economics. I found interesting notes on the web (http://www2.econ.iastate.edu/tesfatsi/reintro....
Frank 's user avatar
  • 41
2 votes
1 answer
78 views

Why is a solution concept of Bayesian Persuasion a subgame perfect equilibrium?

Many papers on Bayesian persuasion adopt SPE as a solution, by arguing that the sender has no private information. This does not make sense to me: Regardless of whether the sender has private ...
good dog's user avatar
1 vote
1 answer
29 views

SIR Model and Information/ Innovation Economics

The SIR Model from epidemiology is being discussed a lot recently due to the COVID19 scenario. I recently read this article about the Corona virus and what economics can offer- https://afinetheorem....
Ishan Kashyap Hazarika's user avatar
1 vote
1 answer
182 views

Premises on which the Efficient Market Hypothesis is built upon

The Efficient Market Hypothesis tells us that stocks are "fairly priced" (i.e. not systematically over- or under-valued). That is, stock prices reflect all information that is already known about them....
Tan Yong Boon's user avatar
26 votes
10 answers
7k views

What are examples for the phenomenon that more (or better) information makes everybody worse off?

More information is usually considered "better". Let's say a rational agent chooses optimally given his information on the circumstances of a particular decision problem. Then providing him with more ...
VARulle's user avatar
  • 7,009
1 vote
1 answer
125 views

Set of Bayes Correlated Equilibria when complete information is not available

Model Consider a game where a decision maker (DM) has to choose action $y\in \mathcal{Y}$ possibly without being fully aware of the state of the world. The state of the world has support $\mathcal{...
Star's user avatar
  • 446
5 votes
2 answers
267 views

Why is infinite recursion on the common knowledge assumption necessary?

If something is common knowledge in a game, that means that every player knows it, and every player knows that every player knows it, and so on. Are there cases where only one such level of knowing ...
gwtw14's user avatar
  • 215
0 votes
2 answers
71 views

How to interpret the intersected information partition element of different actors?

In this paper, it said that given $\omega$ is the current state of the world and $P_1(\omega)$ is the unique element from the information partition $\textit{P_1}$ of actor 1 in which the player 1 is ...
Aqqqq's user avatar
  • 392
0 votes
2 answers
65 views

Do all prices just reflect absence of information?

In information economics, information has economic value because it allows an agent to make better decisions. For example if an agent needs to buy some good, he will benefit from knowing about the ...
A. Sab's user avatar
  • 1
0 votes
1 answer
240 views

How to find change in the optimal choice with a utility function in general form?

Suppose the utility function is represented as $U(x_1,x_2;I)$, where $I$ is the level of information the consumer possesses. How to find the change in the optimal choice of $x_1$ as price of $x_1$ ...
user508281's user avatar
2 votes
0 answers
37 views

How far must one reason up the belief hierarchy?

In games of imperfect information, one must reason about the belief on the state of nature, the beliefs of other player's beliefs of their beliefs, and so on. This is referred to as the belief ...
jonem's user avatar
  • 265
3 votes
1 answer
511 views

Why is it called Bayesian Persuasion?

I'm sure most of you are familiar with the paper titled "Bayesian Persuasion" by Kamenica and Gentzkow (2011), (you can find it here). I was wondering what are your thoughts as to why it is called "...
Regio's user avatar
  • 4,188
7 votes
1 answer
117 views

Robust asymmetric information?

Bergeman and Morris (2014) explain how the concept of Bayesian Correlated equilibrium contains all the robust predictions in games of incomplete information. In particular, their question is what are ...
Regio's user avatar
  • 4,188
3 votes
1 answer
703 views

Insurance and Hirshleifer effect

I am trying to understand the statmement that 'public information kills insurance opportunity' -- referred to as Hirshleifer effect. Does it (in general) lead to some undesirable outcomes? Could you ...
user200947's user avatar
1 vote
2 answers
4k views

Why does the incentive compatibility constraint bind (moral hazard)?

Consider a very basic model of moral hazard with two possible effort levels $e_L<e_H$ and two possible levels of output $y_L<y_H$. If the agent doesn't participate, they get utility of $\bar{u}$....
user avatar
0 votes
1 answer
41 views

Is there any reliable data on what % of the UK population currently earn less than £17,300 annually?

According to the Living Wage Foundation the "real living wage" in the UK is £9 an hour Which assuming a 37 hour week & rounding to the nearest whole GBP amounts to £17,375 Formula used ((9*37)/...
Pelinore's user avatar
  • 133
4 votes
1 answer
71 views

Production choices in Hayek's theory of information-bearing prices

As I understand the work of Hayek, he asserts that prices encapsulate the true societal worth of the item being sold by integrating the compound need for all of the ingredients and work which go into ...
TheChymera's user avatar
6 votes
1 answer
89 views

Is a hyperlink a kind of informational public good?

Links analysis algorithms on the web take the incoming links to a webpage as a sign of its popularity. Given this, can we consider web hyperlinks, in aggregate, as a kind of public good? I am curious ...
Joebevo's user avatar
  • 401
0 votes
1 answer
43 views

Formulas or rules regarding End of Life for vehicle

Are there formulas or rules when keeping a vehicle is no longer financially beneficial? I understand the below needs to be considered: Every time a purchase is made, sales tax will need to be paid. ...
paulj's user avatar
  • 107
6 votes
2 answers
357 views

Does there exist a mathematical formalization of Hayek's ideas about information and the price system?

Hayek's idea, roughly, is that individuals in aggregate have distributed knowledge about their own utility functions and about specific supply-conditions, that no single individual can oversee, and ...
user56834's user avatar
  • 845
7 votes
1 answer
147 views

Common knowledge in model formulation and solution

Economics models usually assume that the structure of the economy is common knowledge among agents. Mathematically, an event is common knowledge if it lies in the meet of all agents' information ...
Michael's user avatar
  • 2,619
5 votes
1 answer
313 views

Higher order beliefs and coherency in game theory

I am reading about the higher order beliefs. Before getting into the formal definitions, I will define some common terminology which I will need for the formal definitions. If $X$ and $Y$ are two ...
user64066's user avatar
  • 277
3 votes
1 answer
88 views

Why does optimal allocation call for unlimited distribution of information?

In his seminal paper Arrow (1962) states that information should be distributed without limit if an optimal allocation is to be achieved. Quote (p. 614-615): The cost of transmitting a given body ...
Fusscreme's user avatar
  • 287
2 votes
1 answer
43 views

Risk and Information

Does anyone know of some papers that look at how risk preferences affect demand for information (or related topics about the connection between risk and Information)? I took an information economics ...
YAK's user avatar
  • 21
2 votes
0 answers
35 views

Is maximal utility conditional on information linear in convex combinations of priors?

This is related to a Mathematica question here - https://math.stackexchange.com/q/1952779/374929 Is a (maximal expected utility) function of the form $U(\mu, X) \equiv \int_\Theta \int_\mathcal{X} \...
Alexander's user avatar
  • 121
3 votes
3 answers
180 views

Does the government have a role to play in certifying people's abilities for the labor market?

The nature of information often makes it look like a public good. Is this the case for certification of peoples abilities? Is there a role the government could play in certifying people's abilities? ...
Fix.B.'s user avatar
  • 2,668
1 vote
2 answers
431 views

How does monopoly affect the informational role of price?

It is said in the textbook "Intermediate Microeconomics a Modern Approach" by Hal Varian that monopoly affects the informational role of price. What's the mechanism?
Guloo's user avatar
  • 73