Valuating Payoff Streams under Unequal Discount Factors

We study repeated prize allocation problem when the discount factors f the agents are not equal. It is shown that the feasible set of payoffs is not well behaved. In particular, it is not convex as it contains holes and caves. The Pareto frontier is everywhere discontinuous and there is an open subset of discount factors such that the feasible set is totally disconnected.

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Year of publication:	2007-06
Authors:	Salonen, Hannu ; Vartiainen, Hannu
Institutions:	Turun Kauppakorkeakoulu, Turun Yliopisto
Subject:	payoffs \| differentiated discount factor \| repeated games

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Extent:	application/pdf
Series:	Discussion Papers. - ISSN 1796-3133.
Type of publication:	Book / Working Paper
Language:	English
Notes:	Number 16 1 pages long
Classification:	C60 - Mathematical Methods and Programming. General ; C70 - Game Theory and Bargaining Theory. General
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10005170525