Monday: 1 pm - 2 pm room 23 and 2.15 pm - 4 pm room 21a
Tuesday: 1 pm - 6 pm room 112
Wednesday: 1 pm - 6 pm room 112
Thursday: 1 pm - 6 pm room 117
Friday: 9 am - 2 pm room 21a
Spandauer Strasse 1.
This course will present a variety of models of choice behavior in single person decision problems and in games where the behavior is influenced by bounds on agents ability to reason and to remember. The course will consist of lectures only. I shall assign short problem sets to students. Students will receive a grade on the basis of their class participation and on the basis of their homeworks. Below is a preliminary list of topics and papers that will be covered.
1. Limited Logical Reasoning Abilities
(a) Robert Aumann, Interactive Epistemology I: Knowledge, International Journal of Game Theory 28 (1999), 263-300.
(b) Robert Aumann, Interactive Epistemology II: Probability, International Journal of Game Theory 28 (1999), 301-314.
2. Limited Awareness
(a) Salvatore Modica and Aldo Rustichini, Unawareness and Partitional Information Structures, Games and Economic Behavior 27 (1999), 265-298.
(b) Eddie Dekel, Barton Lipman and Aldo Rustichini, Standard State Spaces Preclude Unawareness, Econometrica 66 (1998), 159-173.
(c) Oliver Board and Kim-Sau Chung, Object-Based Unawareness: Theory and Applications.
3. Limited Strategic Thinking
(a) Dale O. Stahl and Paul W. Wilson, On Players’ Models of Other Players: Theory and Experimental Evidence, Games and Economic Behavior 10 (1995), 218-254.
(b) Vincent P. Crawford, Miguel A. Costa-Gomes, and Nagore Iriberri, Structural Models of Nonequilibrium Strategic Thinking: Theory, Evidence, and Applications, Journal of Economic Literature 51 (2013), 5-62.
4. Limited Foresight
(a) Philippe Jehiel, Limited Foresight May Force Cooperation, Review of Economic Studies 68 (2001), 369-391.1
(b) Shaowei Ke, Boundedly Rational Backward Induction, Job Market Paper, Princeton, 2015.
5. Bounded Memory
(a) Michele Piccione and Ariel Rubinstein, On the Interpretation of Decision Problems with Imperfect Recall, Games and Economic Behavior 20 (1997), 3-24.
(b) Tilman Börgers and Antonio Morales, Complexity Constraints in Two-Armed Bandit Problems: An Example.
6. Limited Attention
(a) Christopher Sims, Implications of Rational Inattention, Journal of Monetary Economics 50 (2003), 665-690.
(b) Andrew Ellis, Foundations for Optimal Inattention.
7. Strategies of Limited Complexity
(a) Dilip Abreu and Ariel Rubinstein, The Structure of Nash Equilibrium in Repeated Games With Finite Automata, Econometrica 56 (1998), 1259-1281.
8. The Design of Simple Mechanisms
(a) Gabriel Carroll, Robustness and Linear Contracts, American Economics Review 105 (2015), 536-563.
(b) Jacques Crémer and Michael Riordan, A Sequential Solution to the Public Goods Problem, Econometrica 53 (1985), 77-84.
(c) Liad Blumrosen, Noam Nisan and Ilya Segal, Auctions With Severely Bounded Communication, Journal of Artificial Intelligence Research 28 (2007), 233-266.
(d) Qinggong Wu, Coarse Communication and Voting.