Skip to main content
Article thumbnail
Location of Repository

Comment: The Identification Power of Equilibrium in Simple Games

By Victor Aguirregabiria


This paper studies the identification of structural parameters in dynamic games when we replace the assumption of Markov Perfect Equilibrium (MPE) with weaker conditions such as rational behavior and rationalizability. The identification of players' time discount factors is of especial interest. I present identification results for a simple two-periods/two-players dynamic game of market entry-exit. Under the assumption of level-2 rationality (i.e., players are rational and they know that they are rational), a exclusion restriction and a large-support condition on one of the exogenous explanatory variables are sufficient for point-identification of all the structural parameters.

Topics: C13 - Estimation: General, C14 - Semiparametric and Nonparametric Methods: General, C01 - Econometrics
Year: 2008
OAI identifier:

Suggested articles

To submit an update or takedown request for this paper, please submit an Update/Correction/Removal Request.