belief-based refinements in signalling games

Article Abstract:

A refinement of undefeated equilibria avoids the problems posed by sequential equilibria that limit the usefulness of games of incomplete information, and an existence theorem on signalling games is provided. Difficulties in implementing the concept of forward induction are explained. The set of undefeated equilibria in continuous strategy set signalling games is shown to be non-empty, and proofs are presented.

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Sunk investments lead to unpredictable prices

Article Abstract:

The inability to determine the investment levels and prices of stocks simultaneously in a competitive stock market is demonstrated. This situation leads to uncertainty and inefficient levels of investments.

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Efficient non-contractible investments in large economies

Article Abstract:

A two-sided match model in which buyers and seller invest prior to matching is presented. The inefficiencies in equilibrium are also characterized.

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