Sequential Equilibria and Cheap Talk in Form

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hi so in this video we're gonna discuss the phenomenon of asymmetric information and how equilibrium outcome can be achieved in games with asymmetric information as usual let us start with definitions so asymmetric information can be defined as a situation when two parties do not have the same access to information under asymmetric information there is always a worse informed party and there is always a better informed party asymmetric information represents the kind of external uncertainty so as you remember as we discussed during the first lecture there are two types of uncertainty in strategic games like we deal with strategic uncertainty for instance in simultaneous moves games and this one is related to the lack of knowledge about actions undertaken by other player at the same time all the players know exactly the structure of the game under external uncertainty in contrast players do not have the perfect knowledge about the state of the world like there are two possible structure