Learning and Type Compatibility in Signaling Games
Name
1702.01819.pdf
Description
Accepted version
Size
1.05 MB
Format
Adobe PDF
Checksum (MD5)
ad632184c8c456a8aef391771d8b6036
Author(s)
Fudenberg, Drew
He, Kevin
Date Issued
February 2018
Journal
Econometrica
Publisher
The Econometric Society
Citation
Fudenberg, Drew and Kevin He, "Learning and Type Compatibility in Signaling Games." Econometrica 86, 4 (July 2018): 1215-55 doi. 10.3982/ECTA15085 ©2018 Authors
Version
Author's final manuscript
Abstract
Which equilibria will arise in signaling games depends on how the receiver interprets deviations from the path of play. We develop a micro-foundation for these off-path beliefs, and an associated equilibrium refinement, in a model where equilibrium arises through non-equilibrium learning by populations of patient and long-lived senders and receivers. In our model, young senders are uncertain about the prevailing distribution of play, so they rationally send out-of-equilibrium signals as experiments to learn about the behavior of the population of receivers. Differences in the payoff functions of the types of senders generate different incentives for these experiments. Using the Gittins index (Gittins (1979)), we characterize which sender types use each signal more often, leading to a constraint on the receiver's off-path beliefs based on “type compatibility” and hence a learning-based equilibrium selection. ©2018 The Econometric Society
MIT Department
Massachusetts Institute of Technology. Department of Economics
Terms of Use
Creative Commons Attribution-Noncommercial-Share Alike
Persistent DSpace Link
DOI of Published Version
https://doi.org/10.3982/ECTA15085
