Table 17-4
Consider trade relations between Canada and Germany. Assume that the leaders of the two countries believe the payoffs to alternative trade policies are as follows:

-Refer to Table 17-4.Assume that trade negotiations are repeated each year.In a repeated game scenario,what would be the main difference of the game

Question

Table 17-4 
Consider trade relations between Canada and Germany. Assume that the leaders of the two countries believe the payoffs to alternative trade policies are as follows:

-Refer to Table 17-4.Assume that trade negotiations are repeated each year.In a repeated game scenario,what would be the main difference of the game

Quizplus · Accepted Answer

In a repeated game scenario, both parties will assume that the other will choose a strategy that optimizes the total value of the trade relationship. This is because the relationship is ongoing and the success of the trade relationship is important to both parties in the long run. Retaliation for noncooperative behavior can lead to a breakdown of the relationship, which is not beneficial to either party. Therefore, cooperation and mutual benefit are more likely to be the main strategies in a repeated game scenario.

Table 17-4 Consider Trade Relations Between Canada and Germany. Assume That the Assume