Setup and Rules
Implications of Finite Repetitions
- last round looks exactly like the Ultimatum Game
- B should accept any offer - no future anymore
- solution does not depend on the previous rounds
- using Backward Induction we can extend that to second to last round and so forth till the first round for the 1 SPNE
- result: never offer more than minimum, always accept any offer (the SPNE)
- this rollback-based proof holds for any finitely repeated game
- as soon as there are more than 1 SPNE anymore this does not hold anymore
- also applies to Dilemma Games, even if it is repeated
- offers are larger than in non-repeated Ultimatum Game