Find three Bayesian equilibria of the g
- Keat and Sunday are neighbors. They want to live in a clean environment and want their street to be clean. The utility from the clean street is same for both at 10 if only one person clean it and the utility will be same for both at 12 if both people clean it. The problem is someone has to clean the street in order to have a clean street and cleaning the street is a public good. Keat’s cost of cleaning the street is ch and Sunday’s cost is cj. Both ch and cj can have two values, either 5 or 12. The probability that the cost will be 5 is 3/4.
The payoffs will be as the following table.
| Sunday | |||
| Clean | Don’t | ||
| Keat | Clean | 12- ch, 12- cj | 10- ch,10 |
| Don’t | 10, 10- cj | 0,0 |
Find three Bayesian equilibria of the game.
