No. 861: Information design in multi-stage games

Miltiadis Makris , Department of Economics, University of Southampton
Ludovic Renou , Queen Mary University of London

June 25, 2018

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Abstract

We consider multi-stage games, where at each stage, players receive private signals about past and current states, past actions and past signals, and choose actions. We fully characterise the distributions over actions, states, and signals that obtain in any (sequential) communication equilibrium of any expansion of multi-stage games, i.e., when players can receive additional signals about past and current states, past actions, and past and current signals (including the additional past signals). We interpret our results as revelation principles for information design problems. We apply our characterisation to bilateral bargaining problems.

J.E.L classification codes: C73, D82

Keywords:multi-stage games, information design, communication equilibrium, sequential communication equilibrium, information structures, Bayes correlated equilibrium, revelation principle