The Folk Theorem in Repeated Games with Discounting or with Incomplete Information.

Fudenberg, D., & Maskin, E. (1986). The Folk Theorem in Repeated Games with Discounting or with Incomplete Information. Econometrica, 54(3), 533-554.

Type

Journal article

Intellectual base

Primary research

Year

1986

Volume

54

Issue

3

Pages

533-554

DOI

10.2307/1911307

DOI registrant

JSTOR

Link

https://doi.org/10.2307/1911307

Cited from

economics_finance, information_theory

Cited by

3 citations across 3 artifacts.

Each citation links to the sentence it supports in the citing article.

Primes

• Other-Regarding Preferences
  • It specialises preference rather than restating it. Not Cooperation. Cooperation is a behavioural pattern that can arise without other-regarding preferences (repeated-game folk theorem, pure self-interest under the shadow of the future) and that other-regarding preferences can fail to produce (envious or spiteful agents defect).

    This sourceShows any individually rational payoff can be sustained in perfect equilibrium of the repeated game among sufficiently patient self-interested players — cooperation without other-regarding preferences.

    Supported in partVerified against the publisher's abstract

    The abstract states the folk theorem (individually rational payoffs are sustainable in equilibrium of the repeated game among patient players), which backs only the claim's first prong, not the envy/spite prong.

    “any individually rational payoff vector of a one-shot game of complete information can arise in a equilibrium of the infinitely-repeated game if players are sufficiently patient.”

    Read by an automated reader; not a human review. How support was checked

• Shadow Of The Future
  • This is the horizon×observability lever made literal: raise \(\delta\) (longer expected horizon) past the threshold and cooperation becomes a self-interested equilibrium; drop it below and cooperation collapses to one-shot defection — and the folk theorem generalizes this, proving that for sufficiently patient players essentially any individually-rational payoff, cooperation included, is sustainable as an equilibrium.

    Supported in partVerified against the publisher's abstract

    Fudenberg-Maskin's abstract gives the folk theorem for patient players under a two-player or dimensionality condition; it states no cooperation threshold or collapse.

    “When either there are only two players or a full dimensionality condition holds, any individually rational payoff vector of a one-shot game of complete information can arise in a equilibrium of the infinitely-repeated game if players are sufficiently patient.”

    Read by an automated reader; not a human review. How support was checked

• Social Dilemma
  • It supports reasoning about how cooperation can nonetheless be sustained — through iteration and reputation, formalized in the folk theorem and instantiated in strategies like tit-for-tat, which show that the shadow of the future can make cooperation a rational equilibrium of the repeated game even though it is irrational in any single round.

    This sourceEstablishes the folk theorem: with sufficiently patient players, cooperation can be sustained as a subgame-perfect equilibrium of the repeated game even though defection is the unique one-shot equilibrium, formalizing the shadow-of-the-future logic behind tit-for-tat.

    Supported in partVerified against the publisher's abstract

    The abstract states the folk theorem itself — that with sufficiently patient players any individually rational payoff can arise in equilibrium of the infinitely repeated game — but not the tit-for-tat or reputation half of the sentence.

    “any individually rational payoff vector of a one-shot game of complete information can arise in a equilibrium of the infinitely-repeated game if players are sufficiently patient”

    Read by an automated reader; not a human review. How support was checked

Verification

Does it exist? Confirmed. This work's DOI resolves to a registered record, which fixes its identity. That is all it fixes.

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