Achieving Intertemporal Efficiency and Symmetry through Intratemporal Asymmetry: (Eventual) Turn Taking in a Class of Repeated Mixed-Interest Games

Turn taking is observed in many field and laboratory settings. We study when and how turn taking can be supported as an equilibrium outcome in a class of repeated games, where the stage game is a symmetric two-player mixed-interest game with asymmetric joint-payoff-maximizing outcomes that may or may not be Nash equilibria. We consider the "turn taking with independent randomizations" (TTIR) strategy that achieves the following three objectives: (a) helping the players get onto a joint-payoff-maximizing turn-taking path, (b) resolving the question of who gets to start with the good turn first, and (c) deterring defection. The TTIR strategy is simpler than those time-varying strategies considered in the Folk Theorem for repeated games. We determine conditions under which a symmetric TTIR subgame-perfect equilibrium exists and is unique. We also derive comparative static results, and study the welfare properties of the TTIR equilibrium.Conflict, Coordination, Randomization, Turn Taking, Repeated Games

Using Turn Taking to Mitigate Conflict and Coordination Problems in the Repeated Battle of the Sexes Game

The Battle of the Sexes game, which captures both conflict and coordination problems, has been applied to a wide range of situations. We show that, by reducing conflict of interests and enhancing coordination, (eventual) turn taking supported by a ???turn taking with independent randomizations' strategy allows the players to engage in intertemporal sharing of the gain from cooperation. Using this insight, we decompose the benefit from turn taking into conflict-mitigating and coordination-enhancing components. Our analysis suggests that an equilibrium measure of the ???intertemporal degree of conflict??? provides an intuitive way to understand the sources of welfare gain from turn taking in the repeated Battle of the Sexes game. We find that when this equilibrium measure is higher, players behave more aggressively and the welfare gain from turn taking is smaller.Battle of the Sexes game, turn taking, conflict-mitigating, coordinationenhancing

Learning, Teaching, and Turn Taking in the Repeated Assignment Game

History-dependent strategies are often used to support cooperation in repeated game models. Using the indefinitely repeated common-pool resource assignment game and a perfect stranger experimental design, this paper reports novel evidence that players who have successfully used an efficiency-enhancing turn-taking strategy will teach other players in subsequent supergames to adopt this strategy. We find that subjects engage in turn taking frequently in both the Low Conflict and the High Conflict treatments. Prior experience with turn taking significantly increases turn taking in both treatments. Moreover, successful turn taking often involves fast learning, and individuals with turn taking experience are more likely to be teachers than inexperienced individuals. The comparative statics results show that teaching in such an environment also responds to incentives, since teaching is empirically more frequent in the Low Conflict treatment with higher benefits and lower costs.Learning, Teaching, Assignment Game, Laboratory Experiment, Repeated Games, Turn Taking, Common-Pool Resources

Mortality transition and differential incentives for early retirement

Many studies specify human mortality patterns parametrically, with a parameter change affecting mortality rates at different ages simultaneously. Motivated by the stylized fact that a mortality decline affects primarily younger people in the early phase of mortality transition but mainly older people in the later phase, we study how a mortality change at an arbitrary age affects optimal retirement age. Using the Volterra derivative for a functional, we show that mortality reductions at older ages delay retirement unambiguously, but that mortality reductions at younger ages may lead to earlier retirement due to a substantial increase in the individual's expected lifetime human wealth.mortality decline; incentive for early retirement; years-to-consume effect; lifetime human wealth effect

Demographic structure and capital accumulation: A quantitative assessment

In a recent paper, d'Albis [2007. Demographic structure and capital accumulation. Journal of Economic Theory 132, 411-434] shows that the effect of population growth on capital accumulation is ambiguous in overlapping-generations models with age-specific mortality rates, contrasting to the predicted negative effect in Diamond [1965. National debt in a neoclassical growth model. American Economic Review 55, 1126-1150] and Blanchard [1985. Debt, deficits, and finite horizons. Journal of Political Economy 93, 223-247]. The quantitative exercises of this paper indicate that while in principle a positive relation between population growth and capital accumulation is possible, this relation is practically always negative for industrial countries. Intuition based on capital dilution and aggregate saving effects is provided. This paper also complements d'Albis [2007. Demographic structure and capital accumulation. Journal of Economic Theory 132, 411-434] in characterizing the steady-state equilibrium in more familiar economic concepts.Age-specific mortality rates Overlapping generations Population growth Capital accumulation

Observational Equivalence and a Stochastic Cointegration Test of the Neoclassical and Romer’s Increasing Returns Models

[[abstract]]In this paper, we suggest a time series test based on the idea of stochastic cointegration to compare endogenous growth models with those based on exogenous technological progress, and apply it to the neoclassical and Romer's models. First, the non-stationarity and cointegration implications under these two models are derived. They provide the basis for an examination of the phenomenon of observational equivalence and for empirical analysis. We then apply the test to the data of Japan, UK and USA. Empirical results suggest that in each country, there is (are) missing unit root process(es) in the production technology and further investigation is needed to understand the mechanics of economic growth.[[fileno]]2070223010008[[department]]經濟學

Aggregate Pattern of Time-dependent Adjustment Rules, II: Strategic Complementarity and Endogenous Nonsynchronization

This paper provides an explanation for an important institutional feature of staggered time-dependent adjustment rules assumed in a number of macroeconomic models (Fischer, 1977; Taylor, 1980; Blanchaid, 1986). It identifies strategic complementarity as the crucial factor leading to nonsynchronized decisions in a game-theoretic framework. It first shows that nonsynchronization is the equilibrium outcome in an infinite-horizon game in which strategic complementarity is present and each of the players chooses repeatedly both the contract length and a strategic variable. By pursuing Tirole's (1988) interpretation of a nonsynchronized-move dynamic game as a series of games with 'symmetric Stackelberg leadership', it is further suggested that the relationship between strategic complementarity and the benefit to the Stackelberg follower provides the insight to the game-theoretic explanation of nonsynchronization. The results of this paper reveal a link between strategic complementarity and nonsynchronization - two important macroeconomic features