The aim of this paper is to interpret historical evidence to game theory. In the paper, it shows the mechanism of merchant guilds through framework of repeated game.
Surprisingly, game theory can explain history more clearly than old economic theory. Old theory, about cartel, can not explain facilitation of transaction by guilds. It only implies limiting trade for up grading price. On the other hand, repeated game can fully explain the expansion of guilds and their emerging.
It is also interesting two theories have same foundation but conclusions are different. And, later, cartel theory became true when trade were secured by bigger institutions and the interest of guilds became their merit.
Q, how to suppose the condition of act?
Q, what is main difference between game theory and cartel?
Q, why guilds change their role later? Has their interest changed?
No comments:
Post a Comment