International Journal of Game Theory

, Volume 43, Issue 2, pp 455–485 | Cite as

Information acquisition interactions in two-player quadratic games

  • Antonio Jiménez-Martínez


This paper considers two-player quadratic games to examine the relation between strategic interactions in actions and in information decisions. We analyze the role of external effects and of the relative intensities with which the players’ actions interact with the uncertain payoff-relevant parameter. We show that, under some conditions on the quadratic preferences, information choices become substitutes when actions are sufficiently complementary. When attention is restricted to beauty contest games, our results contrast qualitatively with the case studied by Hellwig and Veldkamp (Review of Economic Studies, 76(1)223–251, 2009), where the set of players is a continuum.


Incomplete information Information acquisition  Strategic complements Strategic substitutes Externalities 

JEL Classification

C72 D82 D83 



I am grateful to five anonymous referees and a Co-editor for their extensive feedback which helped to substantially improve the paper. For very useful comments, I also thank Kaniska Dam, Maxim Ivanov, Luciana Moscoso-Boedo, María José Roa-García, Joel Sobel, Laura Veldkamp, and seminar participants at Banco de México, the 2011 SED Meeting at HEC Montreal, and the 2011 Conference on Game Theory at Stony Brook. I gratefully acknowledge financial support from CONACYT (SNI Grant 41286). Any remaining errors are my own.


  1. Angeletos G-M, Pavan A (2004) Transparency of information and coordination in economies with investment complementarities. Am Econ Rev 94(2):91–98CrossRefGoogle Scholar
  2. Angeletos G-M, Pavan A (2007) Efficient use of information and social value of information. Econometrica 75(4):1103–1142CrossRefGoogle Scholar
  3. Calvó-Armengol A, de Martí J (2007) Communication networks: knowledge and decisions. Am Econ Rev Pap Proc 97(2):86–91CrossRefGoogle Scholar
  4. Calvó-Armengol A, de Martí J (2009) Information gathering in organizations: equilibrium, welfare, and optimal network structure. J Eur Econ Assoc 7(1):116–161CrossRefGoogle Scholar
  5. Calvó-Armengol A, de Martí J, Prat A (2011) Communication and influence (unpublished manuscript)Google Scholar
  6. Chatterjee K, Harrison TP (1988) The value of information in competitive bidding. Eur J Oper Res 36: 322–333Google Scholar
  7. Colombo L, Femminis G (2008) The social value of public information with costly information acquisition. Econ Lett 100:196–199CrossRefGoogle Scholar
  8. Cooper R, John A (1988) Coordinating coordination failures in Keynesian models. Q J Econ 103:441–463CrossRefGoogle Scholar
  9. Cornand C, Heinemann F (2008) Optimal degree of public information dissemination. Econ J 118(528): 718–742Google Scholar
  10. Debreu G, Herstein IN (1953) Nonnegative square matrices. Econometrica 21:597–607CrossRefGoogle Scholar
  11. Dewan T, Myatt DP (2008) The qualities of leadership: direction, communication, and obfuscation. Am Political Sci Rev 102(3):351–368CrossRefGoogle Scholar
  12. Dewan T, Myatt DP (2012) On the rhetorical strategies of leaders: speaking clearly, standing back, and stepping down. J Theor Politics 24(4):431–460CrossRefGoogle Scholar
  13. Fudenberg D, Levine D (1986) Limit games and limit equilibria. J Econ Theory 38:261–279CrossRefGoogle Scholar
  14. Hagenbach J, Koessler F (2010) Strategic communication networks. Rev Econ Stud 77:1072–1099CrossRefGoogle Scholar
  15. Hellwig C (2005) Heterogeneous information and the welfare effects of public information disclosures. UCLA Working PaperGoogle Scholar
  16. Hellwig C, Veldkamp L (2009) Knowing what others know: coordination motives in information acquisition. Rev Econ Stud 76(1):223–251CrossRefGoogle Scholar
  17. Moderer D, Shapley LS (1996) Potential games. Games Econ Behav 14:124–143CrossRefGoogle Scholar
  18. Morris S, Shin HS (2002) Social value of public information. Am Econ Rev 92(5):1521–1534CrossRefGoogle Scholar
  19. Morris S, Shin HS (2005) Central bank transparency and the signal value of prices. Brook Pap Econ Act 2:1–66CrossRefGoogle Scholar
  20. Myatt DP, Wallace C (2012) Endogenous information acquisition in coordinationg games. Rev Econ Stud 79:340–374CrossRefGoogle Scholar
  21. Radner R (1962) Team decision problems. Ann Math Stat 33:857–881CrossRefGoogle Scholar
  22. Radner R (1980) Collusive behavior in oligopolies with long but finite lives. J Econ Theory 22:136–156CrossRefGoogle Scholar
  23. Ui T (2009) Bayesian potentials and information structures: team decision problems revisited. Int J Econ Theory 5:271–291CrossRefGoogle Scholar
  24. van Heumen R, Peleg B, Tijs S, Borm P (1996) Axiomatic characterizations and solutions for Bayesian games. Theory Decis 40:103–130CrossRefGoogle Scholar

Copyright information

© Springer-Verlag Berlin Heidelberg 2013

Authors and Affiliations

  1. 1.División de EconomíaCentro de Investigación y Docencia Económicas (CIDE)Mexico CityMexico

Personalised recommendations