Finite State Dynamic Games with Asymmetric Information : A Framework for Applied Work ∗

  title={Finite State Dynamic Games with Asymmetric Information : A Framework for Applied Work ∗},
  author={Chaim Fershtman and Ariel Pakes},
With applied work in mind, we define an equilibrium notion for dynamic games with assymmetric information which does not require a specification for players’ beliefs about their opponents types. This enables us to define equilibrium conditions which, at least in principal, are testable and can be computed using a simple reinforcement learning algorithm. We conclude with an example that endogenizes the maintenance decisions for electricity generators in a dynamic game among electric utilities in… CONTINUE READING
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