Speaker: Marco Serena
Date & Time: Los Angeles (8 am), Cincinnati (11 am), Bath (4 pm), Munich (5 pm), Beijing (11 pm), Singapore (11 pm), Sydney (October 13, 2 am)
Marco Serena will present the paper titled "All-in fighting" (joint work with Stefano Barbieri).
Abstract of the Paper:
How does reputation building affect the intensity of repeated conflicts? We propose a model where players, fighting in a sequence of battles, privately know whether they are rational (and choose fighting efforts so as to maximize payoff) or automatons locked into fighting "all-in" in every battle. Rational players may pretend to be automatons and fight all-in in early battles as doing so buys a beneficial "all-in look" that intimidates rivals in future battles. We study such dynamics. In the unique symmetric equilibrium, a rational player has strictly positive payoff only if she monopolizes reputation for fighting all-in. In a reputational oligopoly, a fierce war of attrition to become the reputational monopolist may yield overdissipation. In a reputational monopoly, overdissipation never happens and the monopolist mixes between fighting "mildly" (not all-in) to cash in on her reputation today and fighting all-in to boost her reputation. Applications include turf wars, conflicts, and litigation.
Chair: Dan Kovenock, Co-Chair: Iryna Topolyan
Max Planck Institute for Tax Law and Public Finance