Efficiency and Equilibrium in the Electronic Mail Game; the General Case

In the Email Game (Rubinstein, AER 89) noisy information channels may prevent efficient coordination, even when the game is almost common knowledge. In the paper we show that this is the case whenever message failure probabilities are not sufficiently different. Quite intuitively, the extent of the difference is governed by the game payoffs, and in particular by the purely mixed Nash equilibrium strategy of one of the two coordination games to be played. This is because, conditional to having observed oneis type, a playeris beliefs on the opponentis choices are governed by the reliability of communication channels