Theoretical Economics 15 (2020), 1175–1219
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Common learning and cooperation in repeated games
Takuo Sugaya, Yuichi Yamamoto
Abstract
We study repeated games in which players learn the unknown state of the world by observing a sequence of noisy private signals. We find that for generic signal distributions, the folk theorem obtains using ex-post equilibria. In our equilibria, players commonly learn the state, that is, the state becomes asymptotic common knowledge.
Keywords: Repeated game, private monitoring, incomplete information, ex-post equilibrium, individual learning
JEL classification: C72, C73
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