11Equilibrium recap¡ Static games of complete informationl Nash equilibrium¡ Dynamic games of complete informationl Subgame-perfect Nash equilibrium¡ Static games of incomplete information (Bayesian games)l Bayesian Nash equilibrium¡ Dynamic games of incomplete informationl Perfect Bayesian equilibrium2Example (cont.)NT [0.6]W [0.4]LRLR11UDUD2UD2UD2(1,0)(3,1)(0,0)(2,1)(0,1)(2,0)(1,1)(3,0)23Example (cont.)NLemon [0.5]High Quality [0.5]QSNo QSQSNo QS11buynot buybuynot buy2buynot buy2buynot buy2[p][q][1-q][1-p]4Dynamic Games of Incomplete Information¡ Each player j has a type θj, where P(θj) is the probability that player j’s type is θj¡ At the beginning of the game, each player learns his type, but is given no information about his opponents’ types¡ (At each stage of the game) players simultaneously choose their actions¡ A strategy maps the set of possible types (and histories) into
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