A counterexample to the folk theorem with discounting

F. Forges; J. F. Mertens; A. Neyman

doi:10.1016/0165-1765(86)90069-8

A counterexample to the folk theorem with discounting

F. Forges^*
, J. F. Mertens
, A. Neyman

^*Corresponding author for this work

Research output: Contribution to journal › Article › peer-review

9 Scopus citations

Abstract

The 'folk theorem' formalizes the theme that 'repetition leads to cooperation'. We present an example showing that, even with perfect monitoring, the set of Nash equilibria of the discounted games does not have to converge to the feasible, individually rational set, i.e., this version of the 'folk theorem' can break down.

Original language	English
Pages (from-to)	7
Number of pages	1
Journal	Economics Letters
Volume	20
Issue number	1
DOIs	https://doi.org/10.1016/0165-1765(86)90069-8
State	Published - 1986
Externally published	Yes

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title = "A counterexample to the folk theorem with discounting",

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A counterexample to the folk theorem with discounting

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