136 research outputs found
Communication, Credible Improvements and the Core of an Economy with Asymmetric Information
We analyze an economy with asymmetric information and endogenize the possibilities for information transmission between members of a coalition. We then define a concept of the Core that takes into account these communication possibilities. The internal consistency of the improvements is considered and an Internally Consistent Core, which requires credibility from the improvements is introduced.Asymmetric Information; Core; Common Knowledge.
Mistakes in cooperation: the stochastic stability of edgeworth's recontracting
In an exchange economy with a finite number of indivisible goods, we analyze a dynamic trading process of coalitional recontracting where agents maymake mistakes with small probability. We show first that the recurrent classes of the unperturbed (mistake-free) process consist of (i) all core allocations as absorbing states, and (ii) non-singleton classes of non-core allocations. Next, we introduce a perturbed process, where the resistance of each transition is a function of the number of agents that make mistakes -do not improve- in the transition and of the seriousness of each mistake. If preferences are always strict, we show that the unique stochastically stable state of the perturbed process is the Walrasian allocation. In economies with indifferences, non-core cycles are sometimes stochastically stable, while some core allocations are not. The robustness of these results is confirmed in a weak coalitional recontracting process
In Defense of DEFECT or Cooperation does not Justify the Solution Concept
The one-state machine that always defects is the only evolutionarily stable strategy in the machine game that is derived from the prisoners' dilemma, when preferences are lexicographic in the complexity. This machine is the only stochastically stable strategy of the machine game when players are restricted to choosing machines with a uniformly bounded complexity.Cooperation; prisoners' dilemma; automata; evolution.
The Core of Economies with Asymmetric Information: An Axiomatic Approach
We propose two generalizations of the Davis-Maschler reduced game property to economies with asymmetric information and apply them in the characterization of two solution concepts. One is Wilson's (1978) Coarse Core and the other is a subsolution of it which we call the Coarse+ Core.Asymmetric information; core; reduced game property; consistency.
Mistakes in cooperation: the stochastic stability of edgeworth's recontracting.
In an exchange economy with a finite number of indivisible goods, we analyze a dynamic trading process of coalitional recontracting where agents maymake mistakes with small probability. We show first that the recurrent classes of the unperturbed (mistake-free) process consist of (i) all core allocations as absorbing states, and (ii) non-singleton classes of non-core allocations. Next, we introduce a perturbed process, where the resistance of each transition is a function of the number of agents that make mistakes -do not improve- in the transition and of the seriousness of each mistake. If preferences are always strict, we show that the unique stochastically stable state of the perturbed process is the Walrasian allocation. In economies with indifferences, non-core cycles are sometimes stochastically stable, while some core allocations are not. The robustness of these results is confirmed in a weak coalitional recontracting process.
MEASURING SEGREGATION
We propose a set of axioms for the measurement of school-based segregation with any number of ethnic groups. These axioms are motivated by two criteria. The first is evenness: how much do ethnic groups’ distributions across schools differ? The second is representativeness: how different are schools’ ethnic distributions from one another? We prove that a unique ordering satisfies our axioms. It is represented by an index that was originally proposed by Henri Theil (1971). This “Mutual Information Index” is related to Theil’s better known Entropy Index, which violates two of our axioms.Segregation, indices, measurement, peer effects, schools, education, equal opportunity.
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