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on Game Theory |
| By: | Dean P Foster; Peyton Young |
| Date: | 2006–03–02 |
| URL: | http://d.repec.org/n?u=RePEc:cla:levarc:784828000000000676&r=gth |
| By: | Eddie Dekel; Drew Fudenberg; Stephen Morris |
| Date: | 2006–03–03 |
| URL: | http://d.repec.org/n?u=RePEc:cla:levrem:122247000000001188&r=gth |
| By: | Barton L. Lipman (Department of Economics, Boston University); Ruqu Wang (Queen’s University) |
| Abstract: | We show that small switching costs can have surprisingly dramatic effects in infinitely repeated games if these costs are large relative to payoffs in a single period. This shows that the results in Lipman and Wang [2000] do have analogs in the case of infinitely repeated games. We also discuss whether the results here or those in Lipman–Wang [2000] imply a discontinuity in the equilibrium outcome correspondence with respect to small switching costs. We conclude that there is not a discontinuity with respect to switching costs but that the switching costs do create a discontinuity with respect to the length of a period. |
| Date: | 2005–06 |
| URL: | http://d.repec.org/n?u=RePEc:bos:wpaper:wp2005-021&r=gth |
| By: | David P. Myatt; Chris Wallace |
| Abstract: | A public good is produced if and only if a team of m or more volunteers contribute to it. An equilibrium-selection problem leads to the questions: will collective action succeed? If so, who will participate in the team? The paper studies the evolution of collective action: as part of a strategy-revision process, updating players choose quantal responses to existing play. With symmetric players, success depends upon the cost of contribution, the benefit from provision, and the critical team-size m; the relative variability of costs and benefits, and their correlation, are also critical. When players differ, successful teams consist of either the most efficient contributors, or those with the most idiosyncratic preferences. The addition of a single "bad apple" (for instance, an individual whose costs are particularly variable) to a population in which a successful team operates may result in destabilisation: over time, the bad apple might supplant an existing contributor, prompting a collapse. |
| Keywords: | Collective Action, Evolution, Teams, Equilibrium Selection, Exponential Cost, Rooted Trees. |
| JEL: | C72 C73 H41 |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:oxf:wpaper:190&r=gth |
| By: | Thomas Norman |
| Abstract: | Evolutionary game theory has largely focused on finite games. Dynamic stability is harder to attain in infinite strategy spaces; Bomze (Monatshefte fur Mathematik 110, 1990, 189-206) and Oechssler and Riedel (Economic Theory 17, 2001, 141-162) provide conditions for the stability of rest points under the replicator dynamics. Here, conditions are given for the stability of sets of strategies under this process. |
| Keywords: | Replicator dynamics, Evolutionary stability, Continouus strategy spaces, Stable sets |
| JEL: | C70 C72 |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:oxf:wpaper:251&r=gth |
| By: | Barry ONeill; Bezalel Peleg |
| Date: | 2006–03–03 |
| URL: | http://d.repec.org/n?u=RePEc:cla:levrem:122247000000001223&r=gth |
| By: | Philip J. Reny |
| Date: | 2005–05–19 |
| URL: | http://d.repec.org/n?u=RePEc:cla:levarc:784828000000000067&r=gth |
| By: | Alan Beggs |
| Abstract: | This paper considers a simple adaptive learning rule in Bayesian games where players employ threshold strategies. Global convergence results are given for supermodular games and potentital games. |
| Keywords: | Bayesian Games, Learning, Binary Actions, Passive Stochastic Approximation |
| JEL: | C72 D83 |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:oxf:wpaper:232&r=gth |
| By: | Richard T. Boylan; Simon Grant |
| Date: | 2006–03–08 |
| URL: | http://d.repec.org/n?u=RePEc:cla:levarc:122247000000001237&r=gth |
| By: | Kohnz, Simone |
| Abstract: | There is strong evidence that in bargaining situations with asymmetric outside options people exhibit self-serving biases concerning their fairness judgements. Moreover, psychological literature suggests that this can be a driving force of bargaining impasse. This paper extends the notion of inequity aversion to incorporate self-serving biases due to asymmetric outside options and analyses whether this leads to bargaining breakdown. I distinguish between sophisticated and naive agents, that is, those agents who understand their bias and those who do not. I find that breakdown in ultimatum bargaining results from naiveté of the proposers. |
| JEL: | D63 C7 A13 |
| Date: | 2005–06 |
| URL: | http://d.repec.org/n?u=RePEc:lmu:muenec:899&r=gth |
| By: | James Bergin (Queen's University); Dan Bernhardt (University of Illinois) |
| Abstract: | This paper characterizes long-run outcomes for broad classes of symmetric games, when players select actions on the basis of average historical performance. Received wisdom is that when agent's interests are partially opposed, behavior is excessively competitive: ``keeping up with the Jones' '' lowers everyones' welfare. Here, we study the long-run consequences of imitative behavior when agents have sufficiently long memories --- and the outcome is dramatically different. Imitation robustly leads to cooperative outcomes (with highest symmetric payoffs) in the long run. This provides a rationale, for example, for collusive cartel-like behavior without collusive intent on the part of the agents. |
| Keywords: | Evolution, Imitation |
| JEL: | C72 C73 D21 D43 |
| Date: | 2006–01 |
| URL: | http://d.repec.org/n?u=RePEc:qed:wpaper:1042&r=gth |
| By: | Juan-Jose Ganuza; Jose S. Penalva-Zuasti |
| Date: | 2005–02–25 |
| URL: | http://d.repec.org/n?u=RePEc:cla:levarc:666156000000000520&r=gth |
| By: | VICTOR AGUIRREGABIRIA (Department of Economics, Boston University); PEDRO MIRA (Centro de Estudios Monetarios y Financieros (CEMFI)) |
| Abstract: | This paper proposes an algorithm to obtain maximum likelihood estimates of structural parameters in discrete games with multiple equilibria. The method combines a genetic algorithm (GA) with a pseudo maximum likelihood (PML) procedure. The GA searches efficiently over the huge space of possible combinations of equilibria in the data. The PML procedure avoids the repeated computation of equilibria for each trial value of the parameters of interest. To test the ability of this method to get maximum likelihood estimates, we present a Monte Carlo experiment in the context of a game of price competition and collusion. |
| Keywords: | Empirical games, Maximum likelihood estimation, Multiple equilibria, Genetic algorithms |
| JEL: | C13 C35 |
| Date: | 2005–01 |
| URL: | http://d.repec.org/n?u=RePEc:bos:wpaper:wp2005-001&r=gth |
| By: | Vincent P. Crawford; Nagore Iriberri |
| Date: | 2006–03–03 |
| URL: | http://d.repec.org/n?u=RePEc:cla:levrem:122247000000001176&r=gth |
| By: | Frederic Koessler; Charles Noussair; Anthony Ziegelmeyer |
| Abstract: | This paper examines simple parimutuel betting games under asymmetric information, with particular attention to differences between markets in which bets are submitted simultaneously versus sequentially. In the simultaneous parimutuel betting market, all (symmetric and asymmetric) Bayesian-Nash equilibria are generically characterized as a function of the number of bettors and the quality of their private information. There always exists a separating equilibrium, in which all bettors follow their private signals. This equilibrium is unique if the number of bettors is sufficiently large. In the sequential framework, earlier bets have information externalities, because they may reveal private information of bettors. They also have payoff externalities, because they affect the betting odds. One effect of these externalities is that the separating equilibrium disappears if the number of betting periods is sufficiently large. |
| Keywords: | Parimutuel betting, Asymmetric information, Information aggregation, Herd behavior, Contrarian behavior |
| JEL: | C72 D82 |
| Date: | 2006–03 |
| URL: | http://d.repec.org/n?u=RePEc:esi:discus:2006-05&r=gth |
| By: | John Thanassoulis |
| Abstract: | Why do people stall while bargaining? Why are people keen to conclude a deal quickly, only to subsequently allow delay before the pie is realised? We propose that the reason is not fully explained by discount rates in combination with agents being engaged in a signalling equilibrium with asymmetric information. Rather we propose that stalling is explained by the fact that agents are worried about a rival coming to bargain for the pie and creating a bidding war - this encourages speedy agreement. The stalling arises when the beliefs as to how likely a rival is to come along differ as each agent waits for the other to update their beliefs and be more accommodating. The stalling region is shown to grow the thicker the market and the lower the discount rate. Thus, we give some predictive power to the new corpus of work on bargaining with uncommon priors. |
| Keywords: | Bargaining, Delay, Optimal Stalling, Learning, Uncommon Priors |
| JEL: | C78 C73 D83 |
| Date: | 2005 |
| URL: | http://d.repec.org/n?u=RePEc:oxf:wpaper:224&r=gth |
| By: | Sergiu Hart |
| Abstract: | n overview of the landmark contributions of Robert J. Aumann, winner of the 2005 Nobel Memorial Prize in Economic Sciences. |
| Keywords: | Robert Aumann; game theory; repeated games; correlated equilibrium; common knowledge; continuum of agents |
| JEL: | C7 D4 D8 B31 |
| Date: | 2006–03 |
| URL: | http://d.repec.org/n?u=RePEc:huj:dispap:dp416&r=gth |