Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/56161
Authors: 
Blonski, Matthias
Spagnolo, Giancarlo
Year of Publication: 
2001
Series/Report no.: 
SSE/EFI Working Paper Series in Economics and Finance 437
Abstract: 
We find that contrary to common perception, cooperation as equilibrium of the infinitely repeated discounted prisoner's dilemma is in many relevant cases not very plausible, or at least questionable: for a significant subset of the payoff-discount factor parameter space cooperation equilibria are strictly risk dominated by non-cooperation (according to the Harsanyi-Selten 1988 criterion). Examples include collusion equilibria in the repeated Cournot duopoly.
Subjects: 
Prisoner's Dilemma
Risk dominance
Repeated games
Equilibrium selection
Cooperation
Collusion
JEL: 
C72
Document Type: 
Working Paper

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