TAKUO SUGAYA

ABSTRACT:

The paper analyzes how discounting and monitoring jointly determine the prospects for cooperation in repeated games with imperfect (public or private) monitoring. The main result derives a simple bound on the average strength of players incentives as a function of discounting, monitoring precision, and payoff variance. The paper also shows that the bound is tight in the low-discounting/low-monitoring double limit, by establishing a folk theorem where the discount factor and monitoring structure vary simultaneously.

BIO:

Takuo Sugaya is an Associate Professor of Economics at the Stanford Graduate School of Business, where he teaches Managerial Economics. His current research focuses on dynamic games - repeated games and stochastic games - and the environments in which different sides engage in cooperative long-run relationships. His research covers both theoretical possibilities of cooperation (such as folk theorem in dynamic games) and applications (such as collusion among firms and dynamic incentives of anti-trust regulators). Takuo received his Ph.D. in Economics from Princeton University in 2012 and his MA in Economics and BA in International Relations from the University of Tokyo. He is currently an associate editor of the Journal of Economic Theory.