# Tag Info

Accepted

### What is the difference between Impression Management and Signaling Theory?

I don't believe those two terms are used in the same spheres. To me, an economic theorist, signaling plays a role in models with asymmetric information when the informed party moves first and the ...
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### Signalling in a moral hazard contract with informed principals (that know their own type before contracting)

I'm not sure what exactly you're looking for, but here are some wild guesses: Bolton and Dewatripont (2005) Contract Theory, MIT Press. [Probably Chapters 5 and 6] Maskin and Tirole (1990) "The ...
• 15.4k
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### Signalling models and out of equilibrium beliefs

In my interpretation of the model, competitive firms imply that the wage always equals the expected productivity, which depends on the beliefs. Clearly, in any pooling equilibrium the on-path beliefs ...
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### Signalling in a moral hazard contract with informed principals (that know their own type before contracting)

Contracting with an informed principal is not so easy because the agent can learn about the principal's type from the kind of contract offered. This introduces signaling, which can quickly get messy. ...
• 5,291
Accepted

### Strong sequential equilibria and the existence of others

There are three classes of equilibria of this game. The first class is sequential: $$(s_1,s_2)=(y,r)$$ and the beliefs are \mu_1(a)=\mu_1(b)=\mu_2(a\mid y)...
• 15.4k
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### How to prove the WPBE is SE in signaling game?

Claim: If choice sets $T, M,$ and $A$ are finite, then an assessment $\{\beta^*_{r}, \beta^*_{s}, \mu^*\}$ is a WPBE (weak perfect Bayesian equilibrium) of the two-stage signalling game between ...
• 1,259
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### What does 'continuation' as in continuation games, strategies, plays, etc. exactly mean?

Consider a game with private information such as a privately known willingness-to-pay or any other type. We usually model this as a game in which at first "Nature" draws the type and then ...
• 5,291
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### Cheap talk with mechanics

Responding to OP's comment For the babbling equilibrium, it's important to note that how S randomizes over his messages matters. In particular, the messages should be randomized in the same way across ...
• 15.4k
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### Sequential Equilibrium (SE) and Perfect Bayesian Equilibrium (PBE) in signaling games

Good question. At the moment, we still do not have a good grasp on what it means for an equilibrium to be a sequential equilibrium in the class of games you mention, with continuum of actions or types,...
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### Signaling game (beer and quiche) and consistent beliefs

It is likely that there is a typo in the Figure; if Nature goes way $S$ with probabilty $1/10$ the calculations and results are consistent. Hard to validate since original text of the problem or ...
• 29.3k
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### Beliefs about equilibrium paths with overlapping strategies

This is a common source of misunderstanding with regards to the concept of equilibrium. The specification of an equilibrium (at least in the standard theory of a one shot games) is agnostic about how ...
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### Beliefs about equilibrium paths with overlapping strategies

In signaling games, beliefs as well as strategies constitute an equilibrium. In other words, beliefs are a part of the equilibrium object. By deciding which equilibrium to focus on, you also (...
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### Divinity for Dummies

Signaling games (games in which an informed "sender" moves first and an uninformed "receiver" second) typically have a plethora of Perfect Bayesian Equilibria which is not really appealing in terms of ...
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### The intuitive criterion

We cannot judge if your answer is correct because we don't see the game tree. First, I would not say that "we can rule out this equlibrium as a possible pooling PBE by the intuitive criterion&...
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### How to understand the intuitive criterion

First, you also have to check all possible separating equilibria. You only checked (MSc,BSc), not (BSc,MSc) with all possible reactions of the receiver. No separating equilibrium exists here. The ...
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### Is the pooling equilibrium profit maximising for the firm?

As suggested in the comments, there are many different signaling models with firms and workers, and also what is the "standard model" to differnt people differs in details. In most of those ...
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### Pooling equilbrium refinement

There are many refinements of pooling equilibria. For starters, you want to make sure all your equilibria are Perfect Bayesian Equilibria. After that, you can also require any equilibrium to survive ...
• 4,188
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### Signalling Game, Multiple Signals

From the perspective of the buyer, he is receiving 1 two-dimensional signal. After observing a combination of the wholesale price and limit order, the buyer can update their beliefs about the supplier'...
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### Refinements in signaling games with three sender types

Both of these criteria refine equilibria where there is an unused message or action. Notice that if there is one action that is not used by any of the types, it can be either because they are all ...
• 4,188
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### Equilibria in Signaling and Screening

The difference between signaling and screening stems from the fundamental difference in bargaining power- who offers the contract for which her utility is the highest. While in screening the uniformed ...
• 5,291
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### What can be considered as a "message"

Given that $T^i$ is $i's$ finite set of messages and the mechanism uses the signal function to map $T$ to a signal, the architects of the mechanism can use any arbitrary label for the individual ...
• 29.3k
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### Do there exist matrix games with more than two players? Can we extend existent models that have already used in signaling games?

The term "matrix game" is not a standard term of game theory, and where it is actually used, it is often used in different ways. Originally, it refered to finite 2-player zero-sum games. ...
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### Any good resources on Information Economics Theory?

For the basics I always liked Varian's "Microeconomic Analysis" (the graduate book). For a good introduction into game theory (with a nice chapter on signalling) I would first read Gibbons' &...
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### Market signaling with a national exam

I think your reasoning is correct. There is no need to have an ''expected pay'' as in a separating equilibrium, everyone ''knows'' that good types will take the test and bad types will not. The only ...
• 12.3k
1 vote

### 'Accuracy' of a Signal

In this case, the signal is accurate [...] with probability $q > 1/2$ seems to mean that when the signal $s$ is observed, the probability of $c_2 = s$ rises to $q$ from $1/2$, while the ...
• 29.3k
1 vote

### Any good resources on Information Economics Theory?

For other people who are interested, I had a talk with a professor who is a theorist and he pointed me to the following books: Introductory coverage of main ideas: "A Course In Microeconomic ...
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1 vote
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### How does this reporting correspondence is redefined?

Without this being a clear answer onge thought could be to define the reporting correspondence as it follows R_i^t(s_i^t|h^{t-1})=\{s_i^t\in S_i^t\quad \text{where player $i$ reports truthfully her ...
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1 vote
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### Competitive equilibrium in signaling games

Can there be a PBE in which both types do not get any education (i.e. $e=0$ for both)? Yes, workers' strategies $e^*(\theta_L)=e^*(\theta_H)=0$ and a wage function $w^*(e)$ satisfying: (i) \$w^*(0)=E[\...
• 15.4k
1 vote

### Signaling in zero-sum games?

I just taught my students that signalling is useless in Matching Pennies and Rock, Paper, Scissors. You would just lie and be random anyway so why would the other player ever believe any signal at all?...
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