The Structure of Signals: Causal Interdependence Models for Games of Incomplete Information

摘要

Traditional economic models typically treat pri vate information, or signals, as generated from some underlying state. Recent work has ex plicated alternative models, where signals cor respond to interpretations of available informa tion. We show that the difference between these formulations can be sharply cast in terms of causal dependence structure, and employ graph ical models to illustrate the distinguishing char acteristics. The graphical representation supports inferences about signal patterns in the interpreted framework, and suggests how results based on the generated model can be extended to more general situations. Specific insights about bid ding games in classical auction mechanisms de rive from qualitative graphical models.