Thomas D. Jeitschko and Hans-Theo Normann (2009) Signaling in Deterministic and Stochastic Settings.
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We contrast a standard deterministic signaling game with one where the signal-generating mechanism is stochastic. With stochastic signals a unique equilibrium emerges that involves separation and has intuitive comparative-static properties as the degree of signaling depends on the prior type distribution. With deterministic signals both pooling and separating configurations occur. Laboratory data support the theory: In the stochastic variant, there is more signaling behavior than with deterministic signals, and less frequent types distort their signals relatively more. Moreover, the degree of congruence between equilibrium and subject behavior is greater in stochastic settings compared to deterministic treatments.
This is a Accepted version This version's date is: 2009 This item is not peer reviewed
https://repository.royalholloway.ac.uk/items/5b99fce1-6330-1ffa-c0f5-6decb804ee3b/1/
Deposited by Leanne Workman (UXYL007) on 11-Oct-2012 in Royal Holloway Research Online.Last modified on 11-Oct-2012
©2009 Thomas D. Jeitschko. Short sections of text, not to exceed two paragraphs, may be quoted without explicit permission provided that full credit including © notice, is given to the source.