Reputation and Patience in the 'War of Attrition

This article presents an approach to selecting among the many subgame-perfect equilibria that exist in a standard concession game with complete information. The authors extend the description of a game to include a specific "irrational" (mixed) strategy for each player. Depending on the irrational strategies chosen, the authors demonstrate that this approach may select a unique equilibrium in which the weaker player concedes immediately. A player is weaker if he is more impatient or if his irrational strategy is to wait in any period with the higher probability. Copyright 1989 by The London School of Economics and Political Science

Economics · Game theory · Irrational number · Mathematical economics · Patience · Political science · Reputation · Subgame perfect equilibrium · Economic theories and models · Economic Theory and Institutions · Game Theory and Applications · Law · Mathematics · Psychology · Social Psychology