Signaling in a Global Game: Coordination and Policy Traps
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Christian Hellwig
CHRISTIAN HELLWIG Professeur Associé d’Economie, Université Toulouse 1, Capitole Toulouse School of Economics, Manufacture de Tabacs, 21 Allées de Brienne, 31000 Toulouse Email: [email protected] Telephone: +33 (0) 5 61 12 85 93 EDUCATION Ph.D. in Economics, London School of Economics, November 2002 M.Sc. in Econometrics and Mathematical Economics, with distinction, London School of Economics, July 1999 B.A. in Economics, University of Lausanne, July 1998 Visiting Student, Oberlin College, August 1994 – June 1995 CURRENT ACADEMIC APPOINTMENTS Professeur Associé, Université de Toulouse 1 Capitole, September 2010 – present Member, Toulouse School of Economics, September 2010 – present Member, Institut d’Economie Industrielle, September 2010 – present Research Affiliate, Centre for Economic Policy Research, July 2007 – present ACADEMIC EXPERIENCE Associate Professor (with tenure), Department of Economics, UCLA, July 2007 – present (on leave 2010-11) Assistant Professor, Department of Economics, UCLA, July 2002 – June 2007 Visiting Research Fellowship, Fondazione Ente ‘Luigi Einaudi’, Rome, June 2007, September 2008 Visiting Assistant Professor, Department of Economics, Columbia University, September – December 2006 Visiting Scholar, Federal Reserve Bank of Minneapolis, September – December 2004 Visiting Scholar, Department of Economics, Northwestern University, March 2004 Visiting Scholar and Instructor, Department of Economics, MIT, September 2000 – June 2002 Research Assistant, Financial Markets Group, LSE, September 1999 – July 2000 PUBLICATIONS IN REFEREED JOURNALS Setting the Right Prices for the Wrong Reasons, with Venky Venkateswaran, Journal of Monetary Economics, vol. 56 (S), p. S57-S77 (October 2009) Bubbles and Self-enforcing Debt, with Guido Lorenzoni, Econometrica, vol. 77 (4), p. 1137-1164 (July 2009) Knowing What Others Know: Coordination Motives in Information Acquisition, with Laura Veldkamp, Review of Economic Studies, vol. -
Prophylaxy Copie.Pdf
Social interactions and the prophylaxis of SI epidemics on networks Géraldine Bouveret, Antoine Mandel To cite this version: Géraldine Bouveret, Antoine Mandel. Social interactions and the prophylaxis of SI epi- demics on networks. Journal of Mathematical Economics, Elsevier, 2021, 93, pp.102486. 10.1016/j.jmateco.2021.102486. halshs-03165772 HAL Id: halshs-03165772 https://halshs.archives-ouvertes.fr/halshs-03165772 Submitted on 17 Mar 2021 HAL is a multi-disciplinary open access L’archive ouverte pluridisciplinaire HAL, est archive for the deposit and dissemination of sci- destinée au dépôt et à la diffusion de documents entific research documents, whether they are pub- scientifiques de niveau recherche, publiés ou non, lished or not. The documents may come from émanant des établissements d’enseignement et de teaching and research institutions in France or recherche français ou étrangers, des laboratoires abroad, or from public or private research centers. publics ou privés. Social interactions and the prophylaxis of SI epidemics on networkssa G´eraldineBouveretb Antoine Mandel c March 17, 2021 Abstract We investigate the containment of epidemic spreading in networks from a nor- mative point of view. We consider a susceptible/infected model in which agents can invest in order to reduce the contagiousness of network links. In this setting, we study the relationships between social efficiency, individual behaviours and network structure. First, we characterise individual and socially efficient behaviour using the notions of communicability and exponential centrality. Second, we show, by computing the Price of Anarchy, that the level of inefficiency can scale up to lin- early with the number of agents. -
Statistical GGP Game Decomposition Aline Hufschmitt, Jean-Noël Vittaut, Nicolas Jouandeau
Statistical GGP Game Decomposition Aline Hufschmitt, Jean-Noël Vittaut, Nicolas Jouandeau To cite this version: Aline Hufschmitt, Jean-Noël Vittaut, Nicolas Jouandeau. Statistical GGP Game Decomposition. Computer Games - 7th Workshop, CGW 2018, Held in Conjunction with the 27th International Con- ference on Artificial Intelligence, IJCAI 2018, Jul 2018, Stockholm, Sweden. pp.79-97, 10.1007/978- 3-030-24337-1_4. hal-02182443 HAL Id: hal-02182443 https://hal.archives-ouvertes.fr/hal-02182443 Submitted on 15 Oct 2019 HAL is a multi-disciplinary open access L’archive ouverte pluridisciplinaire HAL, est archive for the deposit and dissemination of sci- destinée au dépôt et à la diffusion de documents entific research documents, whether they are pub- scientifiques de niveau recherche, publiés ou non, lished or not. The documents may come from émanant des établissements d’enseignement et de teaching and research institutions in France or recherche français ou étrangers, des laboratoires abroad, or from public or private research centers. publics ou privés. In Proceedings of the IJCAI-18 Workshop on Computer Games (CGW 2018) Statistical GGP Game Decomposition Aline Hufschmitt, Jean-No¨elVittaut, and Nicolas Jouandeau LIASD - University of Paris 8, France falinehuf,jnv,[email protected] Abstract. This paper presents a statistical approach for the decompo- sition of games in the General Game Playing framework. General game players can drastically decrease game search cost if they hold a decom- posed version of the game. Previous works on decomposition rely on syn- tactical structures, which can be missing from the game description, or on the disjunctive normal form of the rules, which is very costly to compute. -
Common Belief Foundations of Global Games∗
Common Belief Foundations of Global Games Stephen Morris Hyun Song Shin Muhamet Yildiz Princeton University Bank of International Settlements M.I.T. January 2015 Abstract Complete information games– i.e., games where there is common certainty of payoffs– often have multiple rationalizable actions. What happens if the common certainty of payoffs assumption is relaxed? Consider a two player game where a player’spayoff depends on a payoff parameter. Define a player’s"rank belief" as the probability he assigns to his payoff parameter being higher than his opponent’s. We show that there is a unique rationalizable action played when there is common certainty of rank beliefs, and we argue this is the driving force behind selection results in the global games literature. We consider what happens if players’payoff parameters are derived from common and idiosyncratic terms with fat tailed distributions, and we approach complete information by shrinking the distribution of both terms. There are two cases. If the common component has a thicker tails, then there is common certainty of rank beliefs, and thus uniqueness and equilibrium selection. If the idiosyncratic terms has thicker tails, then there is approximate common certainty of payoffs, and thus multiple rationalizable actions. 1 Introduction Complete information games often have many equilibria. Even when they have a single equilibrium, they often have many actions that are rationalizable, and are therefore consistent with common This paper incorporates material from a working paper of the same title circulated in 2009 (Morris and Shin (2009)). We are grateful for comments from seminar participants at Northwestern on this iteration of the project. -
Crises and Prices: Information Aggregation, Multiplicity, and Volatility
Crises and Prices: Information Aggregation, Multiplicity, and Volatility By GEORGE-MARIOS ANGELETOS AND IVA´ N WERNING* Crises are volatile times when endogenous sources of information are closely monitored. We study the role of information in crises by introducing a financial market in a coordination game with imperfect information. The asset price aggre- gates dispersed private information acting as a public noisy signal. In contrast to the case with exogenous information, our main result is that uniqueness may not obtain as a perturbation from perfect information: multiplicity is ensured with small noise. In addition, we show that: (a) multiplicity may emerge in the financial price itself; (b) less noise may contribute toward nonfundamental volatility even when the equilibrium is unique; and (c) similar results obtain for a model where individuals observe one another’s actions, highlighting the importance of endogenous infor- mation more generally. (JEL D53, D82, D83) It’s a love-hate relationship—economists are outcomes, but often lack obvious comparable at once fascinated and uncomfortable with mul- changes in fundamentals. Many attribute an im- tiple equilibria. On the one hand, crises can be portant role to more or less arbitrary shifts in described as times of high nonfundamental vol- “market sentiments” or “animal spirits,” and atility: they involve large and abrupt changes in models with multiple equilibria formalize these ideas.1 On the other hand, these models can also be viewed as incomplete theories, which should * Angeletos: Department of Economics, Massachusetts ultimately be extended along some dimension Institute of Technology, 50 Memorial Drive, Cambridge, MA 02142, and National Bureau of Economic Research to resolve the indeterminacy. -
Essays on Supermodular Games, Design, and Political Theory
Selection, Learning, and Nomination: Essays on Supermodular Games, Design, and Political Theory Thesis by Laurent Mathevet In Partial Fulfillment of the Requirements for the Degree of Doctor of Philosophy California Institute of Technology Pasadena, California 2008 (Defended May 15th, 2008) ii c 2008 Laurent Mathevet All Rights Reserved iii For my parents, Denise and Ren´eMathevet iv Acknowledgements Many people have helped me along the way. Christelle has been a source of happiness, and without her uncompromising support and faith in me, I would have been miserable. My parents, to whom this dissertation is dedicated, have shown continual and unconditional support despite the distance. They are a constant source of inspiration. I also wish to thank my advisors, Federico Echenique and Matthew Jackson, for their help and encouragement. Federico has spent numerous hours advising me, meeting with me nearly every week since my second year as a graduate student. He has endeavored to extract the most out of me, discarding unpromising thoughts and results, reading my drafts countless times and demanding (countless!) rewrites. Most importantly, he found the right words in those difficult times of a PhD graduate student. Matt has also been a wonderful advisor, available, demanding, and encouraging. I have benefited greatly from his comments, which are the kind that shapes the core of a research project. Matt has funded me for several years, which allowed me to concentrate on research. I also thank him for his invitation to spend a term at Stanford to further my research. I am indebted to Preston McAfee, whose personality, charisma, and sharpness have made meetings with him among the most fruitful and enjoyable. -
Game Theory for Signal Processing in Networks
Game Theory for Signal Processing in Networks Giacomo Bacci, Samson Lasaulce, Walid Saad, and Luca Sanguinetti Abstract In this tutorial, the basics of game theory are introduced along with an overview of its most recent and emerging applications in signal processing. One of the main features of this contribution is to gather in a single paper some fundamental game-theoretic notions and tools which, over the past few years, have become widely spread over a large number of papers. In particular, both strategic-form and coalition-form games are described in details while the key connections and differences betweenthemareoutlined.Moreover,aparticularattention is also devoted to clarify the connections between strategic-form games and distributed optimization and learning algorithms. Beyond an introduction to the basic concepts andmainsolutionapproaches,severalcarefullydesigned examples are provided to allow a better understanding of how to apply the described tools. I. INTRODUCTION game theory (GT) is a branch of mathematics that enables the modeling and analysis of the interactions between several decision-makers (called players) who can have conflicting or common objectives. A game is a situation in which the benefit or cost achieved by each player from an interactive situation depends, not only on its own decisions, but also on those taken by the other players. For example, the time a car driver needs to get back home generally depends not only on the route he/she chooses but also on the decisions taken by the other drivers. Therefore, in a game, the actions and objectives of the players are tightly coupled.Untilveryrecently,GThas been used only marginally in signal processing (SP), with notable examples being some applications in robust detection and estimation [1] as well as watermarking [2] (in which the watermarking problem is seen as a game between the data embedder and the attacker). -
Convergence to Approximate Nash Equilibria in Congestion Games†
Convergence to Approximate Nash Equilibria in Congestion Games† Steve Chien‡ Alistair Sinclair§ Abstract We study the ability of decentralized, local dynamics in non-cooperative games to rapidly reach an approximate Nash equilibrium. For symmetric congestion games in which the edge delays satisfy a “bounded jump” condition, we show that convergence to an ε-Nash equilibrium occurs within a number of steps that is polynomial in the number of players and ε−1. This appears to be the first such result for a class of games that includes examples for which finding an exact Nash equilibrium is PLS-complete, and in which shortest paths to an exact equilibrium are exponentially long. We show moreover that rapid convergence holds even under only the apparently minimal assumption that no player is excluded from moving for arbitrarily many steps. We also prove that, in a generalized setting where players have different “tolerances” εi that specify their thresholds in the approximate Nash equilibrium, the number of moves made by a player before equilibrium is reached depends only on his associated εi, and not on those of the other players. Finally, we show that polynomial time convergence still holds even when a bounded number of edges are allowed to have arbitrary delay functions. 1 Introduction The emerging field of algorithmic game theory has led to a fundamental re-examination, from a computational perspective, of the classical concept of Nash equilibrium [20]. Much of this activity has focused on understanding the structure of Nash equilibria (as expressed, notably, in the “price of anarchy,” see e.g. [22, 25, 24]) and the computational complexity of finding them (see, e.g., [10, 7, 4]). -
Bounded Rationality in Keynesian Beauty Contests: a Lesson for Central Bankers?
Vol. 14, 2020-16 | June 04, 2020 | http://dx.doi.org/10.5018/economics-ejournal.ja.2020-16 Bounded rationality in Keynesian beauty contests: a lesson for central bankers? Felix Mauersberger, Rosemarie Nagel, and Christoph Bühren Abstract The great recession (2008) triggered an apparent discrepancy between empirical findings and macroeconomic models based on rational expectations alone. This gap led to a series of recent developments of a behavioral microfoundation of macroeconomics combined with the underlying experimental and behavioral Beauty Contest (BC) literature, which the authors review in this paper. They introduce the reader to variations of the Keynesian Beauty Contest (Keynes, The general theory of employment, interest, and money, 1936), theoretically and experimentally, demonstrating systematic patterns of out-of-equilibrium behavior. This divergence of (benchmark) solutions and bounded rationality observed in human behavior has been resolved through stepwise reasoning, the so-called level k, or cognitive hierarchy models. Furthermore, the authors show how the generalized BC function with limited parameter specifications encompasses relevant micro and macro models. Therefore, the stepwise reasoning models emerge naturally as building blocks for new behavioral macroeconomic theories to understand puzzles like the lacking rise of inflation after the financial crisis, the efficacy of quantitative easing, the forward guidance puzzle, and the effectiveness of temporary fiscal expansion. (Published in Special Issue Bio-psycho-social foundations of macroeconomics) JEL E12 E13 E7 D80 D9 C91 Keywords Beauty Contest game; expectation formation; equilibration; level k reasoning; behavioral macroeconomics; game theory; experimental economics Authors Felix Mauersberger, University of Bonn, Germany Rosemarie Nagel, ICREA-UPF Barcelona GSE, Spain, [email protected] Christoph Bühren, Clausthal University of Technology, Germany Citation Felix Mauersberger, Rosemarie Nagel, and Christoph Bühren (2020). -
Efficiency of Mechanisms in Complex Markets
EFFICIENCY OF MECHANISMS IN COMPLEX MARKETS A Dissertation Presented to the Faculty of the Graduate School of Cornell University in Partial Fulfillment of the Requirements for the Degree of Doctor of Philosophy by Vasileios Syrgkanis August 2014 ⃝c 2014 Vasileios Syrgkanis ALL RIGHTS RESERVED EFFICIENCY OF MECHANISMS IN COMPLEX MARKETS Vasileios Syrgkanis, Ph.D. Cornell University 2014 We provide a unifying theory for the analysis and design of efficient simple mechanisms for allocating resources to strategic players, with guaranteed good properties even when players participate in many mechanisms simultaneously or sequentially and even when they use learning algorithms to identify how to play and have incomplete information about the parameters of the game. These properties are essential in large scale markets, such as electronic marketplaces, where mechanisms rarely run in isolation and the environment is too complex to assume that the market will always converge to the classic economic equilib- rium or that the participants will have full knowledge of the competition. We propose the notion of a smooth mechanism, and show that smooth mech- anisms possess all the aforementioned desiderata in large scale markets. We fur- ther give guarantees for smooth mechanisms even when players have budget constraints on their payments. We provide several examples of smooth mech- anisms and show that many simple mechanisms used in practice are smooth (such as formats of position auctions, uniform price auctions, proportional bandwidth allocation mechanisms, greedy combinatorial auctions). We give algorithmic characterizations of which resource allocation algorithms lead to smooth mechanisms when accompanied by appropriate payment schemes and show a strong connection with greedy algorithms on matroids. -
Transparency of Information and Coordination in Economies with Investment Complementarities
ISSUES IN MACROECONOMIC POLICY DESIGN Transparency of Information and Coordination in Economies with Investment Complementarities By GEORGE-MARIOS ANGELETOS AND ALESSANDRO PAVAN* Economies with production externalities, de- spect to public information, which increases the mand spillovers, incomplete financial markets, volatility generated by common noise in market and Keynesian frictions are only a few exam- expectations. Moreover, when information is ples of those in which macroeconomic comple- heterogeneous, an increase in the precision of mentarities play a prominent role. Within this public information may have the perverse effect class of economies, how does the precision of of increasing aggregate volatility, by increasing publicly provided and privately collected infor- the sensitivity of economic activity to common mation affect equilibrium allocations and social noise. On the contrary, an increase in the pre- welfare? And what is the optimal transparency cision of private information necessarily re- in the information conveyed, for example, by duces aggregate volatility. Nevertheless, we economic statistics, policy announcements, or show that, as long as there is no value to lotter- news in the media? To answer these questions, ies, welfare unambiguously increases with an we consider a simple real economy where the increase in either the relative or the absolute individual return to investment is increasing in precision of public information. Hence, policies the aggregate level of investment and where that either disseminate more precise informa- market participants have heterogenous expecta- tion about economic fundamentals or reduce the tions about the underlying economic fundamen- heterogeneous interpretation of economic statis- tals (the exogenous productivity). We interpret tics and policy measures necessarily boost wel- an increase in the transparency of public infor- fare. -
Interests, Evidence and Games Brian Weatherson
Interests, Evidence and Games Brian Weatherson Pragmatic encroachment theories have a problem with evidence. On the one hand, the arguments that knowledge is interest-relative look like they will generalise to show that evidence too is interest-relative. On the other hand, our best story of how interests affect knowledge presupposes an interest-invariant notion of evidence. The aim of this paper is to sketch a theory of evidence that is interest-relative, but which allows that ‘best story’ to go through with minimal changes. The core idea is that the evidence someone has is just what evidence a radical interpreter says they have. And a radical interpreter is playing a kind of game with the person they are interpreting. The cases that pose problems for pragmatic encroachment theorists generate fascinating games between the interpreter and the interpretee. They are games with multiple equilibria. To resolve them we need to detour into the theory of equilibrium selection. I’ll argue that the theory we need is the theory of risk- dominant equilibria. That theory will tell us how the interpreter will play the game, which in turn will tell us what evidence the person has. The evidence will be interest- relative, because what the equilibrium of the game is will be interest-relative. But it will not undermine the story we tell about how interests usually affect knowledge. 1 Encroachment, Reduction and Explanation I will start with an argument for a familiar disjunctive conclusion: either knowledge is interest-relative, or scepticism is true. The argument will resemble arguments to the same disjunctive conclusion in Hawthorne (2004) and Fantl and McGrath (2009).