Dependence and Uniqueness in Bayesian Games.

Working paper

This paper studies uniqueness of equilibrium in symmetric 2 x 2 bayesian games. It shows that if signals are highly but not perfectly dependent then players play their risk-dominant actions for all but a vanishing set of signal realizations. In contrast to the global games literature, noise is not assumed to be additive. Dependence is modeled using the theory of copulas.

Authors: Beggs, A

• Publisher: Department of Economics (University of Oxford)
• Series: Discussion paper series
• Publication date: 2012-01-01
• Language: English