In a two-stage extensive form game where followers can observe moves by leaders only with noise, pure subgame perfect Nash equilibria of the limiting game without noise may not survive arbitrarily small noise. Still, for generic games, there is always at least one subgame perfect equilibrium...

Consider the durable goods monopoly game with uniformly distributed consumers' valuations. To establish the Coase-Conjecture in this context takes an infinite time horizon and a negligible delay between market rounds. An infinite time horizon or patience of market participants alone are not...

One of the long-standing puzzles in economics is why wages do not fall sufficiently in recessions so as to avoid increases in unemployment. Put differently, if the competitive market wage declines, why don't employers simply force their employees to accept lower wages as well? As an alternative...

One of the long-standing questions in economics is whether or not wages will fall sufficiently in recessions so as to avoid increases in unemployment. Put differently, if the competitive market wage declines, will employers simply force their employees to accept lower wages as well? As an...

The traditional model of sequential decision making, for instance, in extensive form games, is a tree. Most texts define a tree as a connected directed graph without loops and a distinguished node, called the root. But an abstract graph is not a domain for decision theory. Decision theory...