
doi: 10.2139/ssrn.2005713
This paper provides a dual characterization of the limit set of perfect public equilibrium payoffs in stochastic games (in particular, repeated games) as the discount factor tends to one. As a first corollary, the folk theorems of Fudenberg, Levine and Maskin (1994), Kandori and Matsushima (1998) and Horner, Sugaya, Takahashi and Vieille (2011) obtain. As a second corollary, in the context of repeated games, it follows that this limit set of payoffs is a polytope (a bounded polyhedron) when attention is restricted to equilibria in pure strategies. We provide a two-player game in which this limit set is not a polytope when mixed strategies are considered.
Stochastic games, Repeated games, Folk theorem, jel: jel:C72, jel: jel:C73
Stochastic games, Repeated games, Folk theorem, jel: jel:C72, jel: jel:C73
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