Unlike a one-shot game, in a repeated game: A) players have the opportunity to u

Question

Unlike a one-shot game, in a repeated game:

A) players have the opportunity to use mixed strategies.

B) each player’s objective is to claim a greater payoff with the first move.

C) players have the opportunity to build trust and cooperation.

D) a player’s prior reputation carries relatively little importance.

E) players are obliged to take independent actions.

A) players have the opportunity to use mixed strategies.

B) each player’s objective is to claim a greater payoff with the first move.

C) players have the opportunity to build trust and cooperation.

D) a player’s prior reputation carries relatively little importance.

E) players are obliged to take independent actions.

Explanation / Answer

Answer.) C) players have the opportunity to build trust and cooperation.

Contrary to one-shot games, players have the opportunity of conditioning their behavior on past actions of the other players in a repetitive game. This means that in repeated games players have the opportunity of building trust by acting in a cooperative way, but also punishing other players for non-cooperative actions.

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