Reputational dynamics expresses the view that reputation should be conceptualized as an intrinsically dynamic phenomenon. This intuition is reflected in informal accounts of corporate reputation that indicate changing value such as reputational capital or a moral bank account. These metaphors (“reputation is like a financial asset”) capture the fact that the value of a company’s reputation can wax and wane over time in response to company actions or external events. This entry discusses reputational dynamics from the perspective of modern game theory. It discusses the commonly used game-theoretic concept of reputation as “hidden information,” outlines some of the limitations of this view, and offers an alternative perspective.

Overview Using Modern Game Theory

In modern game theory, reputation is modeled as a belief structure in a dynamic game ...

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