Prisoner's Dilemma & Repeated Games: Discounting and the Grim-Trigger δ
This lesson is part of the course
In this lesson
You discount the profit streams of cooperating and of cutting prices once, add them up over 10 rounds and find the discount factor above which a grim-trigger agreement holds.
Buy the course once for $9.99 to unlock every lesson and lab, the final exam and the certificate – lifetime access, no subscription.
Lessons in this course
- Payoff Matrices & Best Responses: MAX per Column and per Row Locked
- Dominant & Dominated Strategies: Iterated Elimination Step by Step Locked
- Pure-Strategy Nash Equilibria: Cells Where Both Play a Best Response Locked
- Prisoner's Dilemma & Repeated Games: Discounting and the Grim-Trigger δ Locked
- Mixed-Strategy Equilibrium in a 2×2 Game: The Indifference Equations Locked
- Zero-Sum Games & Minimax: Saddle Points and the Value of a Mixed Game Locked
- Sequential Games: Backward Induction and Entry Deterrence Locked
- Auction Basics: First-Price vs Second-Price Revenue (Revenue Equivalence) Locked