A Dynamic Model of Equilibrium Selection In Signaling Markets

Authors:	Nöldeke, Gerorg ; Samuelson, Larry
Institutions:	ESRC Centre for Economic Learning and Social Evolution (ELSE), Department of Economics
Subject:	ract: In his work on signaling \| Spence proposed a dynamic model of a market in which a buyer revises prices in light of experience and in which sellers \| with private information about their types \| choose utility-maximizing signals given these prices. We follows Spence's suggestion of introducing perturbations into the resulting dynamic process. In a broad class of markets \| our model selects a separating equilibrium outcome if and only if the equilibrium outcome satisfies a version of the undefeated equilibrium concept \| whereas a pooling equilibrium outcome is selected if and only if the equilibrium outcome is both undefeated and satisfies D1

Extent:	application/pdf
Series:	ELSE working papers.
Type of publication:	Book / Working Paper
Classification:	C70 - Game Theory and Bargaining Theory. General ; C72 - Noncooperative Games ; D82 - Asymmetric and Private Information ; D83 - Search, Learning, Information and Knowledge
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10005636445