Efficiency and Observability with Long-Run and Short-Run Players The Harvard community has made this article openly available. Please share how this access benefits you. Your story matters. Citation Fudenberg, Drew and David K. Levine. 1994. Efficiency and observability with long-run and short-run players. Journal of Economic Theory 62, no. 1: 103-135. Published Version doi:10.1006/jeth.1994.1006 Accessed July 12, 2017 12:18:37 PM EDT Citable Link http://nrs.harvard.edu/urn-3:HUL.InstRepos:3203774 Terms of Use This article was downloaded from Harvard University's DASH repository, and is made available under the terms and conditions applicable to Other Posted Material, as set forth at http://nrs.harvard.edu/urn-3:HUL.InstRepos:dash.current.terms-ofuse#LAA (Article begins on next page) EFFICIENCY AND OBSERVABILITY WITH LONG-RUN AND SHORT-RUN PLAYERS * 'UHZ)XGHQEHUJ DQG 'DYLG./HYLQH 0D\ 5HYLVHG6HSWHPEHU :HDUHJUDWHIXOWR(GGLH'HNHO7DEDN'DYLG0.UHSVDQG(ULF0DVNLQ16)*UDQWV6(6 DQG6(6SURYLGHGILQDQFLDOVXSSRUW 'HSDUWPHQWVRI(FRQRPLFV0,7DQG8&/$UHVSHFWLYHO\ $EVWUDFW :HSUHVHQWDJHQHUDODOJRULWKPIRUFRPSXWLQJWKHOLPLWDV →RIWKHVHWRISD\RIIVRI SHUIHFWSXEOLFHTXLOLEULDRIUHSHDWHGJDPHVZLWKORQJUXQDQGVKRUWUXQSOD\HUVDOORZLQJIRUWKH SRVVLELOLW\WKDWWKHSOD\HUV DFWLRQVDUHQRWREVHUYDEOHE\WKHLURSSRQHQWV:HLOOXVWUDWHWKH 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