We show that small switching costs can have surprisingly dramatic effects in infinitely repeated games if these costs are large relative to payoffs in a single period. This shows that the results in Lipman and Wang do have analogs in the case of infinitely repeated games [Lipman, B., Wang, R.,...

We show that the standard results for finitely repeated games do not survive the combination of two simple variations on the usual model. In particular, we add a small cost of changing actions and consider the effect of increasing the frequency of repetitions within a fixed period of time. We...

We show that small switching costs can have surprisingly dramatic effects in infinitely repeated games if these costs are large relative to payoffs in a single period. This shows that the results in Lipman and Wang [2000] do have analogs in the case of infinitely repeated games. We also discuss...

Lipman [2003] shows that in a finite model, the common prior assumption has weak implications for finite orders of beliefs about beliefs. In particular, the only such implications are those stemming from the weaker assumption of a common support. To explore the role of the finite model...

Tirole (1982) is commonly interpreted as proving that bubbles are impossible with finitely many rational traders with common priors. We study a simple variation of his model in which bubbles can occur, even though traders have common priors and common knowledge that the asset has no fundamental...

I characterize the implications of the common prior assumption for finite orders of beliefs about beliefs at a state and show that the only such implications are those stemming from the weaker assumption of a common support. More precisely, given any model where priors have the same support and...