Private Strategies in Finitely Repeated Games with Imperfect Public Monitoring∗

Abstract

We present three examples of finitely repeated games with public monitoring that have sequential equilibria in private strategies, i.e., strategies that depend on own past actions as well as public signals. Such private sequential equilibria can have features quite unlike those of the more familiar perfect public equilibria: (i) making a public signal less informative can create Pareto superior equilibrium outcomes; (ii) the equilibrium finalperiod action profile need not be a stage game equilibrium; and (iii) even if the stage game has a unique correlated (and hence Nash) equilibrium, the first-period action profile need not be a stage game equilibrium. Journal of Economic Literature classification numbers: C72, C73.

Cite this paper

@inproceedings{Mailath2002PrivateSI, title={Private Strategies in Finitely Repeated Games with Imperfect Public Monitoring∗}, author={George J. Mailath and Steven A. Matthews and Tadashi Sekiguchi and Dilip Abreu and Michihiro Kandori and Leslie Marx and Ichiro Obara}, year={2002} }