Consider a setting of complete contracting in a discretionary environment, where the court will impose transfers as specified by the players.
For each of the following two underlying games, how much should the players be jointly willing to pay to transform the setting from one of limited verifiability, where the court cannot distinguish between (I, N), (N, I), and (N, N) but knows whether (I, I) was played, to one of full verifiability, where the court knows exactly what the players did?
To answer this question, you must determine the outcomes in the two different information settings. Here are the two underlying games:
