A robust folk theorem for the prisoner's dilemma

Jeffrey C. Ely*, Juuso Välimäki

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

116 Scopus citations

Abstract

We prove the folk theorem for the Prisoner's dilemma using strategies that are robust to private monitoring. From this follows a limit folk theorem: when players are patient and monitoring is sufficiently accurate, (but private and possibly independent) any feasible individually rational payoff can be obtained in sequential equilibrium. The strategies used can be implemented by finite (randomizing) automata. Journal of Economic Literature Classification Numbers: C72, C73, D82.

Original languageEnglish (US)
Pages (from-to)84-105
Number of pages22
JournalJournal of Economic Theory
Volume102
Issue number1
DOIs
StatePublished - 2002

Funding

1We thank the Associate Editor and an anonymous referree for helpful comments and suggestions. Gorkem Celik provided valuable research assistance. 2Financial support from NSF grant 9985462 is gratefully acknowledged.

ASJC Scopus subject areas

  • Economics and Econometrics

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