Cho, I.-K., and D.Kreps, "Signaling Games and Stable Equilibria," Quarterly Journal of Economics 102 (1987), 179--221.  Home/Search   Document Not in Database   Summary   Related Articles   Check

....and . rms are not able to identify the human capital of an unskilled worker by means of education, since this kind of workers are characterized by a common educational quali. cation; this means that such asymmetry of information can not be ruled out by means of education, as in the Cho and Kreps [6], solution to the Spence s model. As it will be clearer later, the model involves a budget constraint due to the cost of investing in higher education, which causes less endowed individuals not to invest in human capital. The presence of such a constraint in the signal set produces a break down of ....

Cho I.K., Kreps D.M., 1987, Signaling Games and Stable Equilibria, Quarterly Journal of Economics, 102, 179-221.

....or more refinement concepts. 1 Different analysts seem to prefer different refinements. In this article we provide experimental evidence concerning the predictive power of one particularly popular refinement, namely equilibrium dominance, also known as the intuitive criterion, developed by Cho and Kreps (1987). We examine equilibrium dominance in the context of simple financial markets in which the proposed refinement makes clear, testable predictions. These predictions are then compared to the actual behavior of agents in a controlled setting. The objective is to determine the extent to which ....

....Sometimes participants played a less refined equilibrium which nonetheless satisfied equilibrium dominance. However, non Nash behavior was also observed quite frequently, typically about one third of the time. Brandts and Holt (1992) examined variants of the examples originally presented by Cho and Kreps (1987). Equilibrium dominance predicted the observed equilibrium for a large proportion of the observations. However, the markets did not start out in equilibrium; they gradually converged to it. By altering payoffs to change typical convergence patterns, Brandts and Holt (1992) were able to create ....

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Cho, I. K., and D. M. Kreps, 1987, "Signaling Games and Stable Equilibria," Quarterly Journal of Economics, 52, 179--221.

....consider the most favorable case for equilibrium, that in which beliefs are that any demand greater than 7.00 is made by a spiteful type. Because the spiteful type has the most reason to make large demands, these beliefs are consistent with quite strong refinements such as the intuitive criterion (Cho and Kreps [1987]) Given these beliefs, it is clear that since normal types are indifferent between accepting and rejecting the 7.00 demand that only the altruistic type will accept larger demands. Since it is most favorable for making large demands, let us suppose that the altruistic type is sufficiently ....

Cho, I. and D. Kreps [1987]: "Signaling Games and Stable Equilibria," Quarterly Journal of Economics.

.... to the highest bidders (Van Huyck et al. 1993) Crawford and Broseta (1998) These devices, which are equivalent to giving some players an opportunity to choose a costly signal, typically do not reduce the number of Nash equilibria of these games, but forward induction refinements such as the Cho Kreps (1987) intuitive criterion may eliminate all equilibria except those in which the sender sends a costly signal (bypassing the outside option in (1) or paying a high price for the right to play in (2) and the Pareto efficient equilibrium of the stage game is then played. 6 observed actions differ ....

Cho, I.-K., and D. Kreps (1987), "Signaling Games and Stable Equilibria," Quarterly Journal of Economics 102, pp. 179--221.

.... o to the highest bidders (Van Huyck et al. 1993) Crawford and Broseta (1998) These devices, which are equivalent to giving some players an opportunity to choose a costly signal, typically do not reduce the number of Nash equilibria of these games, but forward induction renements such as the Cho Kreps (1987) intuitive criterion may eliminate all equilibria except those in which the sender sends a costly signal (bypassing the outside option in (1) or paying a high price for the right to play in (2) and the Pareto ecient equilibrium of the stage game is then played. 11 By this logic, we can ....

Cho, I.-K., and D. Kreps (1987), \Signaling Games and Stable Equilibria," Quarterly Journal of Economics 102, pp. 179-221.

....level of campaign expenditures. According to belief (29) they should conclude that a positive expenditure can come with equal probability from a low type or from a high type. To check whether the pooling equilibrium is plausible, one can apply the well known Intuitive Criterion by Cho and Kreps [11] which checks the plausibility of out of equilibrium beliefs. Suppose the incumbent makes a positive level of campaign expenditures a 0 . Voters should ask themselves what she is trying to signal. Suppose that, if voters believed that a 0 could only come from a high type, then in fact a high ....

In-Koo Cho and David Kreps. Signaling games and stable equilibria. Quarterly Journal of Economics, 102(2):179-221, 1987.

.... 3 A signaling equilibrium is still possible in which both high and medium types are believed to signal, but if lows are su#ciently unproductive relative to mediums and highs and if the recommendations completely separate lows and highs, the equilibrium does not survive the intuitive criterion (Cho and Kreps, 1987). If, as assumed in the theory section of the paper, the recommendations only stochastically separate lows and highs, signaling and countersignaling equilibria may coexist. This issue is explored further in the theory section. 6 NICK FELTOVICH, RICK HARBAUGH, AND TED TO For simplicity this ....

....beliefs are consistent with Bayes rule and the equilibrium sender strategy. 7 As it turns out, there will be many pure strategy Perfect Bayesian Equilibria. Furthermore, various standard refinements do not yield a unique equilibrium (i.e. Intuitive Criterion and Divinitylike refinements (Cho and Kreps, 1987; Banks and Sobel, 1987) However, with the exception of Proposition 4 and a brief discussion, we defer these details to Appendix A. We adopt the convention here of calling a perfect Bayesian equilibrium a signaling equilibrium if s q is weakly monotonic in the sender s type and strictly ....

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Cho, I.-K. and D. M. Kreps (1987), "Signaling games and stable equilibria," Quarterly Journal of Economics, 102, 179--221.

....dierent talents pool at x, then the inference gives the expected talent of an individual drawn at random. Second, we impose a restriction on inferences concerning eort choices that do not occur in equilibrium. Restrictions of this sort are standard in the literature on signaling games (see, e.g. Cho and Kreps (1987); cf. Bernheim (1994) because otherwise it is hard to get clearcut results and a host of equilibria with unintuitive interpretations may result. In the current context, we could (for many values of x 0) sustain a strange equilibrium such as the following: Each individual chooses the same ....

I.-K. Cho and D. M. Kreps. Signaling games and stable equilibria. Quarterly Journal of Economics, 52:179-221, 1987.

.... to the highest bidders (Van Huyck et al. 1993) Crawford and Broseta (1998) These devices, which are equivalent to giving some players an opportunity to choose a costly signal, typically do not reduce the number of Nash equilibria of these games, but forward induction refinements such as the Cho Kreps (1987) intuitive criterion may eliminate all equilibria except those in which the sender sends a costly signal (bypassing the outside option in (1) or paying a high price for the right to play in (2) and the Pareto efficient equilibrium of the stage game is then played. 11 By this logic, we can ....

Cho, I.-K., and D. Kreps (1987), "Signaling Games and Stable Equilibria," Quarterly Journal of Economics 102, pp. 179--221.

....in G. In fact, this is true regardless of which refinement concept we use to place restrictions on veto sets. Hence, d is ratifiable against G relative to a particular refinement if the refinement allows a veto set V such that c u (V) 0.8515. 4.1. The Intuitive Criterion The intuitive criterion (Cho and Kreps, 1987) requires that beliefs be concentrated on those types for whom there exists some belief such that if the ratifying firm inferred those beliefs from a veto, then this type of firm would wish to veto. In other words, no weight can be put on types for whom the deviation of vetoing is bad in the ....

CHO, I.-K., AND KREPS, D M. (1987). "Signaling Games and Stable Equilibria." Quart. J. Econ. 102, 179-222.

....o# to the highest bidders #Van Huyck et al. #1993#, Crawford and Broseta #1998##. These devices, which are equivalent to giving some players an opportunitytochoose a costly signal, typically do not reduce the number of Nash equilibria of these games, but #forward induction re#nements such as the Cho#Kreps #1987# intuitive criterion may eliminate all equilibria except those in which the sender sends a costly signal #bypassing the outside option in #1# or paying a high price for the right to play in #2##, and the Pareto e#cient equilibrium of the stage game is then played. 8 into other potential ....

Cho, I.-K., and D. Kreps #1987#, #Signaling Games and Stable Equilibria," Quarterly Journal of Economics 102, pp. 179#221.

.... to the highest bidders (Van Huyck et al. 1993) Crawford and Broseta (1998) These devices, which are equivalent to giving some players an opportunity to choose a costly signal, typically do not reduce the number of Nash equilibria of these games, but forward induction refinements such as the Cho Kreps (1987) intuitive criterion may eliminate all equilibria except those in which the sender sends a costly signal (bypassing the outside option in (1) or paying a high price for the right to play in (2) and the Pareto efficient equilibrium of the stage game is then played. into other potential ....

Cho, I.-K., and D. Kreps (1987), "Signaling Games and Stable Equilibria," Quarterly Journal of Economics 102, pp. 179--221.

....of any signaling model would predict more signal (dividends) to be sent, it is more reasonable to presume that other real world institutions might evolve that permitted information to be communicated in a cheaper fashion. Instead of the separating equilibrium, which can be justified with a Cho and Kreps (1987) argument, a pooling equilibrium in which no firm pays any dividends becomes more plausible. 4 A model extension that introduces a free riding institution also shows that this free riding institution makes separation more difficult, and thus increases the dividend paid in equilibrium. 2 The ....

Cho, I.-K., and D. Kreps, 1987, "Signaling Games and Stable Equilibria," Quarterly Journal of Economics, 102(2), 179--122.

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Cho, I.-K., and D.Kreps, "Signaling Games and Stable Equilibria," Quarterly Journal of Economics 102 (1987), 179--221.

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Cho, I.-K. and D. Kreps (1987), "Signaling Games and Stable Equilibria." The Quarterly Journal of Economics 102(2): 179-221.

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Cho, I-K. and D.M. Kreps, 1987, `Signaling games and stable equilibria', Quarterly Journal of Economics, 102: 179 -- 222.

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I.-K. Cho and D. Kreps. Signaling games and stable equilibria. Quarterly Journal of Economics, 102:179--222, 1987.

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