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http://hdl.handle.net/10419/51561
  
Title:Signaling in deterministic and stochastic settings PDF Logo
Authors:Jeitschko, Thomas D.
Normann, Hans-Theo
Issue Date:2011
Series/Report no.:DICE discussion paper 35
Abstract:We contrast a standard deterministic signaling game with one where the signal-generating mechanism is stochastic. With stochastic signals a unique equilibrium emerges that involves separation and has intuitive comparative-static properties as the degree of signaling depends on the prior type distribution. With deterministic signals both pooling and separating configurations occur. Laboratory data support the theory: In the stochastic variant, there is more signaling behavior than with deterministic signals, and less frequent types distort their signals relatively more. Moreover, the degree of congruence between equilibrium and subject behavior is greater in stochastic settings compared to deterministic treatments.
Subjects:experiments
learning
noise
signaling
stochastic environments
JEL:C7
C9
D8
ISBN:978-3-86304-034-5
Document Type:Working Paper
Appears in Collections:DICE Discussion Paper, Düsseldorf Institute for Competition Economics (DICE)

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