【正文】
N 1 D a 1 d 2 2 a d D (a, r) (r, a) (0, 0) (0, 0) (a, r) (a, r) Such that 0 a r Player1 forms beliefs over and Player 2 forms beliefs over and Equilibrium will look like: p = Prob(Player 1 plays D), m = Prob( ) q = Prob(Player 2 plays d), n = Prob( ) 1 Play D: m*[q*0+(1q)*(r)]+(1m)*0 = m*(1q)*(r) 1 Play A: m*(a)+ (1m)*(a) = a Always play A if m = 1, q = 0, else play D PBE: (A, a, 1, 1)…though Nature goes (189。) / (189。Section 9: Redux Alexis Diamond Outline ? Overview of equilibrium concepts so far ? Example of perfect Bayesian equilibrium ? Example of moary policy (see handout from last section) – Theories of delegation – Timeconsistency Overview ? Nash Equilibrium ? Mixedstrategy Nash Equilibrium ? Subgame Perfect Equilibrium ? Bayesian Equilibrium ? Perfect Bayesian Equilibrium Key Terms ? Equilibrium path: a node to node path observed in equilibrium – A strategy off the equilibrium path is never observed – Any branch on which there is positive support (probability) for play forms part of the equilibrium path – There may be multiple equilibrium paths if there are multiple equilibria ? In Nash equilibrium, the credibility of best responses judged