Reputation and the Flow of Information in Repeated Games

摘要

Equilibrium payoff bounds from reputation effects are derived for repeated games with imperfect public monitoring in which a long-run player interacts frequently with a population of short-run players and the monitoring technology scales with the length of the period of interaction. The bounds depend on the monitoring technology through theflow of information, a measure of signal informativeness per unit of time based on relative entropy. Examples are shown where, under complete information, the set of equilibrium payoffs of the long-run player converges, as the period length tends to zero, to the set ofstaticequilibrium payoffs, whereas when the game is perturbed by a small ex ante probability on commitment types, reputation effects remain powerful in the high-frequency limit.