This paper models individual choices of social groups and the formation of group identity, and examines the conditions with which the group identity reinforces the productivity of individuals. A social group is defined as a network that provides with a market for interactions to its members....

In an abstract model of division problems, we study division rules that are not manipulable through a reallocation of individual characteristic vectors within a coalition (e.g. reallocation of claims in bankruptcy problems). A coalition can be formed if members of the coalition are connected on...

This paper is motivated by a practical income (or wealth) taxation problem: For a public good economy where the provision of public goods is to be financed by income taxes collected from individuals, what is the optimal feasible tax mechanism when a social planner is relatively uninformed of the...

Self regulation is a mechanism of quality vigilance that is frequently used in credence good industries. The providers in these markets generally form a Self Regulated Organization (SRO), composed by some members of the industry, whose main job is to convince consumers through an active...

Dow and Welang (1994) extended the notion of Nash equilibrium for two-player finite normal games when players are uncertainty on the behavior of his opponents. They showed the existence of equilibrium for any given degree of uncertainty however constant over all possible events, except the null...

This paper analyzes a stochastic model of evolution in normal form games. The long-run behavior of individuals in this model is investigated in the limit where mutation rates tend to zero, while the expected number of mutations, and hence population sizes, tend to infinity. It is shown that...

Consider a multilateral bargaining problem where negotiation is conducted by a sequence of bilateral bargaining sessions. We are interested in an environment where bargaining protocols are determined endogenously. During each bilateral bargaining session of Rubinstein (1982), two players...

In some games, the impact of higher-order uncertainty is very large, implying that present economic theories may be misleading as these theories assume common knowledge of the type structure after specifying the first or the second orders of beliefs. Focusing on normal-form games in which the...

The “mushroom treatment� is a common metaphor for the practice of “keeping employees in the dark and feeding them a steady diet of bull manure.� We develop a model of this practice of information suppression and misrepresentation within organizations,...

We provide necessary and sufficient conditions for observed outcomes in extensive game forms, in which preferences are unobserved, to be rationalized first, partially, as a Nash equilibrium and then, fully, as the unique subgame-perfect equilibrium. Thus, one could use these conditions to find...