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He was the recipient of the Nobel Memorial Prize in Economic Sciences in 1994. Harsanyi is best known for his contributions to the study of game theory and its application to economics, specifically for his developing the highly innovative analysis of games of incomplete information, so-called Bayesian games.
Thus, there is incomplete information (because the suspect has private information), making it a Bayesian game. There is a probability p that the suspect is a criminal, and a probability 1-p that the suspect is a civilian; both players are aware of this probability (common prior assumption, which can be converted into a complete-information ...
Information economics or the economics of information is the branch of microeconomics that studies how information and information systems affect an economy and economic decisions. [ 1 ] One application considers information embodied in certain types of commodities that are "expensive to produce but cheap to reproduce."
In economics and game theory, complete information is an economic situation or game in which knowledge about other market participants or players is available to all participants. The utility functions (including risk aversion), payoffs, strategies and "types" of players are thus common knowledge .
In economics and game theory, global games are games of incomplete information where players receive possibly-correlated signals of the underlying state of the world. Global games were originally defined by Carlsson and van Damme (1993).
In economics, incomplete markets are markets in which there does not exist an Arrow–Debreu security for every possible state of nature. [1] In contrast with complete markets , this shortage of securities will likely restrict individuals from transferring the desired level of wealth among states.
In contract theory, mechanism design, and economics, an information asymmetry is a situation where one party has more or better information than the other. Information asymmetry creates an imbalance of power in transactions, which can sometimes cause the transactions to be inefficient, causing market failure in the worst case.
The economics of information has recently become of great interest to many - possibly due to the rise of information-based companies inside the technology industry. [9] From a game theory approach, the usual constraints that agents have complete information can be loosened to further examine the consequences of having incomplete information.