Bad reputation

Jeffrey C. Ely; Juuso Välimäki

doi:10.1162/00335530360698423

Bad reputation

Jeffrey C. Ely, Juuso Välimäki

Economics

Research output: Contribution to journal › Review article › peer-review

98 Scopus citations

Abstract

We construct a model where the reputational concern of the long-run player to look good in the current period results in the loss of all surplus. This is in contrast to the bulk of the literature on reputations where such considerations mitigate myopic incentive problems. We also show that in models where all parties have long-run objectives, such losses can be avoided.

Original language	English (US)
Pages (from-to)	785-814
Number of pages	30
Journal	Quarterly Journal of Economics
Volume	118
Issue number	3
DOIs	https://doi.org/10.1162/00335530360698423
State	Published - Aug 2003

ASJC Scopus subject areas

Economics and Econometrics

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10.1162/00335530360698423

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@article{31921d76330d424a8fac4f52a5c99403,

title = "Bad reputation",

abstract = "We construct a model where the reputational concern of the long-run player to look good in the current period results in the loss of all surplus. This is in contrast to the bulk of the literature on reputations where such considerations mitigate myopic incentive problems. We also show that in models where all parties have long-run objectives, such losses can be avoided.",

author = "Ely, {Jeffrey C.} and Juuso V{\"a}lim{\"a}ki",

note = "Funding Information: * This paper has previously been peer reviewed in NAJ Economics. See http://dlevine.econ.ucla.edu/v4.htm. We thank Gregory Pavlov for invaluable research assistance. We received helpful comments from Drew Fudenberg, David Levine, Thomas Mariotti, Stephen Morris, Michele Piccione, Tom Wiseman, the editor, and three anonymous referees. Ely gratefully acknowledges financial support from NSF grant #9985462.",

year = "2003",

month = aug,

doi = "10.1162/00335530360698423",

language = "English (US)",

volume = "118",

pages = "785--814",

journal = "Quarterly Journal of Economics",

issn = "0033-5533",

publisher = "Oxford University Press",

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AU - Ely, Jeffrey C.

AU - Välimäki, Juuso

N1 - Funding Information: * This paper has previously been peer reviewed in NAJ Economics. See http://dlevine.econ.ucla.edu/v4.htm. We thank Gregory Pavlov for invaluable research assistance. We received helpful comments from Drew Fudenberg, David Levine, Thomas Mariotti, Stephen Morris, Michele Piccione, Tom Wiseman, the editor, and three anonymous referees. Ely gratefully acknowledges financial support from NSF grant #9985462.

PY - 2003/8

Y1 - 2003/8

N2 - We construct a model where the reputational concern of the long-run player to look good in the current period results in the loss of all surplus. This is in contrast to the bulk of the literature on reputations where such considerations mitigate myopic incentive problems. We also show that in models where all parties have long-run objectives, such losses can be avoided.

AB - We construct a model where the reputational concern of the long-run player to look good in the current period results in the loss of all surplus. This is in contrast to the bulk of the literature on reputations where such considerations mitigate myopic incentive problems. We also show that in models where all parties have long-run objectives, such losses can be avoided.

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DO - 10.1162/00335530360698423

M3 - Review article

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JO - Quarterly Journal of Economics

JF - Quarterly Journal of Economics

SN - 0033-5533

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ER -

Bad reputation

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