<p>I'm not sure what you mean by risk pricing, but because you mention a repeated game, you might find the following papers useful. They present some theory about repeated games in which players have limited memory.</p>

<ul>
<li><a href="https://ideas.repec.org/p/unl/unlfep/wp500.html" rel="nofollow">One - Memory in Repeated Games</a></li>
<li><a href="http://www.sciencedirect.com/science/article/pii/S002205310800063X" rel="nofollow">Repeated games with one-memory</a></li>
<li><a href="http://www.princeton.edu/~smorris/pdfs/PhD/Monte.pdf" rel="nofollow">Reputation and Bounded Memory in Repeated Games with Incomplete
Information</a></li>
</ul>

CC BY-SA 3.0
2014-11-19T18:00:49.947Z
I meant risk pricing in terms of discounting the value or utility of a given outcome based on its likelihood.
Jason Nichols
CC BY-SA 3.0
2014-11-19T21:36:14.363Z
Do you have a link or suggestion of where I might find a formal definition of "risk pricing?"
jmbejara
CC BY-SA 3.0
2014-11-19T21:39:07.830Z
http://en.wikipedia.org/wiki/Expected_utility_hypothesis
Jason Nichols
CC BY-SA 3.0
2014-11-19T21:44:49.343Z
Right, it's just that the term "risk pricing" is probably too broad. I'm not sure what it's referring to because it sounds like you could be talking about a stochastic discount factor or state price vector that discounts payoffs in different states by both the likelihood that that state occurs as well as other conditions. http://en.wikipedia.org/wiki/State_prices
jmbejara
CC BY-SA 3.0
2014-11-19T21:45:54.737Z
Perhaps you want to know about how risk aversion might change (so that the risk premium might change)?
jmbejara
CC BY-SA 3.0
2014-11-19T21:48:51.113Z
roughly. If you play the game repeatedly (against different opponents), how long until memory fades, and prices return to "normal" for a given opponent, and how would that curve look?
Jason Nichols
CC BY-SA 3.0
2014-11-19T21:53:06.477Z
Let us [continue this discussion in chat](http://chat.stackexchange.com/rooms/18814/discussion-between-jmbejara-and-jason-nichols).
jmbejara
CC BY-SA 3.0
2014-11-19T17:16:24.577Z
2014-11-19T17:16:24.577Z
jmbejara
<p>Have studies been done that demonstrate the limits of human memory on reputation in the Iterated Prisoner's Dilemma?</p>

<p>i.e. at what point (on average) does a player start to "forget" the actions of a previous opponent? </p>

CC BY-SA 3.0
2014-11-20T03:21:52.313Z
Have you ever taken a course on human memory? I'm asking because "limits" is a term that someone who doesn't know anything would use. But that's not the major problem with your question. The question is actually about psychology not economic and so this is the wrong forum for it. "Cognative Sciences" is probably the best place for it.
JenSCDC
CC BY-SA 3.0
2014-11-23T06:53:28.560Z
You mean like the **Availability Heuristic**?
Steve S
CC BY-SA 3.0
2014-11-23T06:59:28.343Z
@AndyBlankertz: K-A-H-N-E-M-A-N. He won the Nobel Prize in Economics in 2002. And yet... get this... the guy's actually a Psychologist. In other words, "Cognative" [sic] Scientists actually *do* have a place on this forum.
Steve S
<game-theory><behavioral-economics>
How much impact does memory have on risk pricing?
Jason Nichols
# How much impact does memory have on risk pricing?

(Asked by: username_0 on 2014-11-19)

Have studies been done that demonstrate the limits of human memory on reputation in the Iterated Prisoner's Dilemma?

i.e. at what point (on average) does a player start to "forget" the actions of a previous opponent?

**Tags:** game-theory, behavioral-economics
> **Comments:**
> **username_1**: Have you ever taken a course on human memory? I'm asking because "limits" is a term that someone who doesn't know anything would use. But that's not the major problem with your question. The question is actually about psychology not economic and so this is the wrong forum for it. "Cognative Sciences" is probably the best place for it.  
> **username_2**: You mean like the **Availability Heuristic**?  
> **username_2**: @AndyBlankertz: K-A-H-N-E-M-A-N. He won the Nobel Prize in Economics in 2002. And yet... get this... the guy's actually a Psychologist. In other words, "Cognative" [sic] Scientists actually *do* have a place on this forum.  

---

## 1 answers

### Answer by username_3 on 2014-11-19. Score: 1

I'm not sure what you mean by risk pricing, but because you mention a repeated game, you might find the following papers useful. They present some theory about repeated games in which players have limited memory.

* [One - Memory in Repeated Games](https://ideas.repec.org/p/unl/unlfep/wp500.html)
* [Repeated games with one-memory](http://www.sciencedirect.com/science/article/pii/S002205310800063X)
* [Reputation and Bounded Memory in Repeated Games with Incomplete
  Information](http://www.princeton.edu/~smorris/pdfs/PhD/Monte.pdf)

> **Comments:**
> **username_0**: I meant risk pricing in terms of discounting the value or utility of a given outcome based on its likelihood.  
> **username_3**: Do you have a link or suggestion of where I might find a formal definition of "risk pricing?"  
> **username_0**: http://en.wikipedia.org/wiki/Expected_utility_hypothesis  
> **username_3**: Right, it's just that the term "risk pricing" is probably too broad. I'm not sure what it's referring to because it sounds like you could be talking about a stochastic discount factor or state price vector that discounts payoffs in different states by both the likelihood that that state occurs as well as other conditions. http://en.wikipedia.org/wiki/State_prices  
> **username_3**: Perhaps you want to know about how risk aversion might change (so that the risk premium might change)?  
> **username_0**: roughly. If you play the game repeatedly (against different opponents), how long until memory fades, and prices return to "normal" for a given opponent, and how would that curve look?  
> **username_3**: Let us [continue this discussion in chat](http://chat.stackexchange.com/rooms/18814/discussion-between-jmbejara-and-jason-nichols).  

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