We consider the problem of a principle who wishes to induce two agents playing a one shot prisoner's dilemma to behave cooperatively. We assume that the principal cannot observe the actions of the agents, and is not able to change the strategy sets or payoff functions in the underlying game. The...

Can the author always design a game form so that all its Bayesian equilibrium outcomes are either interim individually rational efficient or interim envy-free efficient in asymmetric information economies? The author shows that the answer is no. Given that such games exist in complete...