7,905 research outputs found
Reputation in the Long-Run with Imperfect Monitoring
We study an infinitely repeated game where two players with equal discount factors play a simultaneous-move stage game. Player one monitors the stagegame actions of player two imperfectly, while player two monitors the pure stagegame actions of player one perfectly. Player one’s type is private information and he may be a “commitment type,” drawn from a countable set of commitment types, who is locked into playing a particular strategy. Under a full-support assumption on the monitoring structure, we prove a reputation result for games with locally nonconflicting interests or games with strictly conflicting interests: if there is positive probability that player one is a particular type whose commitment payoff is equal to player one’s highest payoff, consistent with the players’ individual rationality, then a patient player one secures this type’s commitment payoff in any Bayes-Nash equilibrium of the repeated game. In contrast, if the type’s commitment payoff is strictly less than player one’s highest payoff consistent with the players’ individual rationality, then the worst perfect Bayesian equilibrium payoff for a patient player one is equal to his minimax payoff.Repeated Games, Reputation, Equal Discount Factor, Long-run Players,imperfect Observation, Complicated Types, Finite Automaton JEL Classification Numbers: C73, D83
Reputation in perturbed repeated games
The paper analyzes reputation effects in perturbed repeated games with discounting. If there is some positive prior probability that one of the players is committed to play the same (pure) action in every period, then this provides a lower bound for her equilibrium playoff in all Nash equilibria. This bound is tight and independent of what other types have positive probability. It is generally lower than Fudenberg and Levine's bound for games with a long-run player facing a sequence of short-run opponents. The bound cannot be improved by considering types playing finitely complicated history-dependent commitment strategies
Modeling Bitcoin Contracts by Timed Automata
Bitcoin is a peer-to-peer cryptographic currency system. Since its
introduction in 2008, Bitcoin has gained noticeable popularity, mostly due to
its following properties: (1) the transaction fees are very low, and (2) it is
not controlled by any central authority, which in particular means that nobody
can "print" the money to generate inflation. Moreover, the transaction syntax
allows to create the so-called contracts, where a number of
mutually-distrusting parties engage in a protocol to jointly perform some
financial task, and the fairness of this process is guaranteed by the
properties of Bitcoin. Although the Bitcoin contracts have several potential
applications in the digital economy, so far they have not been widely used in
real life. This is partly due to the fact that they are cumbersome to create
and analyze, and hence risky to use.
In this paper we propose to remedy this problem by using the methods
originally developed for the computer-aided analysis for hardware and software
systems, in particular those based on the timed automata. More concretely, we
propose a framework for modeling the Bitcoin contracts using the timed automata
in the UPPAAL model checker. Our method is general and can be used to model
several contracts. As a proof-of-concept we use this framework to model some of
the Bitcoin contracts from our recent previous work. We then automatically
verify their security in UPPAAL, finding (and correcting) some subtle errors
that were difficult to spot by the manual analysis. We hope that our work can
draw the attention of the researchers working on formal modeling to the problem
of the Bitcoin contract verification, and spark off more research on this
topic
Reputation and commitment in two-person repeated games without discounting
Two-person repeated games with no discounting are considered where there is uncertainty about the type of the players. If there is a possibility that a player is an automaton committed to a particular pure or mixed stage-game action, then this provides a lower bound on the Nash equilibrium payoffs to a normal type of this player. The lower bound is the best available and is robust to the existence of other types. The results are extended to the case of two-sided uncertainty. This work extends Schmidt (1993) who analyzed the restricted class of conflicting interest games
On the Disambiguation of Weighted Automata
We present a disambiguation algorithm for weighted automata. The algorithm
admits two main stages: a pre-disambiguation stage followed by a transition
removal stage. We give a detailed description of the algorithm and the proof of
its correctness. The algorithm is not applicable to all weighted automata but
we prove sufficient conditions for its applicability in the case of the
tropical semiring by introducing the *weak twins property*. In particular, the
algorithm can be used with all acyclic weighted automata, relevant to
applications. While disambiguation can sometimes be achieved using
determinization, our disambiguation algorithm in some cases can return a result
that is exponentially smaller than any equivalent deterministic automaton. We
also present some empirical evidence of the space benefits of disambiguation
over determinization in speech recognition and machine translation
applications
Reputation and commitment in two-person repeated games
Game Theory;Repeated Games
Information and the reconstruction of quantum physics
The reconstruction of quantum physics has been connected with the interpretation of the quantum formalism, and has continued to be so with the recent deeper consideration of the relation of information to quantum states and processes. This recent form of reconstruction has mainly involved conceiving quantum theory on the basis of informational principles, providing new perspectives on physical correlations and entanglement that can be used to encode information. By contrast to the traditional, interpretational approach to the foundations of quantum mechanics, which attempts directly to establish the meaning of the elements of the theory and often touches on metaphysical issues, the newer, more purely reconstructive approach sometimes defers this task, focusing instead on the mathematical derivation of the theoretical apparatus from simple principles or axioms. In its most pure form, this sort of theory reconstruction is fundamentally the mathematical derivation of the elements of theory from explicitly presented, often operational principles involving a minimum of extra‐mathematical content. Here, a representative series of specifically information‐based treatments—from partial reconstructions that make connections with information to rigorous axiomatizations, including those involving the theories of generalized probability and abstract systems—is reviewed.Accepted manuscrip
On the Optimality of the Equality Matching Form of Sociality
We consider a two-player game in which one player can take a costly action (i.e., to provide a favor) that is bene¯cial to the other. The game is in¯nitely repeated and each player is equally likely to be the one who can provide the favor in each period. In this context, equality matching is de¯ned as a strategy in which each player counts the number of times she has given in excess of received and she gives if and only if this number has not reached an upper bound. We show that the equality matching strategy is simple, self-enforcing, symmetric, and irreducible. Furthermore, we show that the utility for each player is at least as high under equality matching as under any other simple, self-enforcing, symmetric, and irreducible strategy of the same complexity. Thus, we rationalize equality matching as being an e±cient way to achieve those properties. This result is applied to risk sharing in village economies and used to rationalize the observed correlations between individual consump- tion and individual income and between present and past transfers across individuals.
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