Simple Bounds on the Value of a Reputation


  • Olivier Gossner

    1. Paris School of Economics, 48 Boulevard Jourdan, 75014 Paris, France and London School of Economics, London, U.K.;
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    • 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.


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.