The author is grateful to Drew Fudenberg for encouraging this project, and to Mehmet Ekmekci, Larry Samuelson, and Saturo Takahashi for insightful comments. Useful suggestions from an editor and two anonymous referees are gratefully acknowledged.
Simple Bounds on the Value of a Reputation
Article first published online: 20 SEP 2011
© 2011 The Econometric Society
Volume 79, Issue 5, pages 1627–1641, September 2011
How to Cite
Gossner, O. (2011), Simple Bounds on the Value of a Reputation. Econometrica, 79: 1627–1641. doi: 10.3982/ECTA9385
- Issue published online: 20 SEP 2011
- Article first published online: 20 SEP 2011
- Manuscript received June, 2010; final revision received December, 2010.
- repeated games;
- incomplete information;
- relative entropy
We introduce entropy techniques to study the classical reputation model in which a long-run player faces a series of short-run players. The long-run player's actions are possibly imperfectly observed. We derive explicit lower and upper bounds on the equilibrium payoffs to the long-run player.