Partnership with partial commitment: a game theoretic approach
This paper derives the Nash-equilibrium degrees of commitment to a partnership where lack of full commitment fuels suspicion and increases potential losses for partners. The Nash-equilibrium commitment of each partner increases with her internal return, quitting cost and costs of being deserted and with her counterpart's external return and intrinsic capacity to detect lack of full commitment, but diminishes with her external return and intrinsic capacity to detect her counterpart's lack of full commitment and with her counterpart's internal return, quitting cost and costs of being deserted.
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