nep-gth New Economics Papers
on Game Theory
Issue of 2008‒07‒14
five papers chosen by
Laszlo A. Koczy
University of Maastricht

  1. Computation of the Nucleolus for a Class of Disjunctive Games with a Permission Structure By René van den Brink; Ilya Katsev; Gerard van der Laan
  2. Cooperative Interval Games Arising from Airport Situations with Interval Data By Alparslan-Gok, S.Z.; Branzei, R.; Tijs, S.H.
  3. Properties and applications of dual reduction By Yannick Viossat
  4. A Dynamic Model of Conflict and Cooperation By Wolfgang Eggert; Jun-ichi Itaya; Kazuo Mino
  5. Belief Elicitation in Experiments: Is there a Hedging Problem? By Blanco, Mariana; Engelmann, Dirk; Koch, Alexander K.; Normann, Hans-Theo

  1. By: René van den Brink (VU University Amsterdam); Ilya Katsev (Russian Academy of Sciences); Gerard van der Laan (VU University Amsterdam)
    Abstract: A situation in which a finite set of players can obtain certain payoffs by cooperation can be described by a cooperative game with transferable utility, or simply a TU-game. A (single-valued) solution for TU-games assigns a payoff distribution to every TU-game. A well-known solution is the nucleolus. A cooperative game with a permission structure describes a situation in which players in a cooperative TU-game are hierarchically ordered in the sense that there are players that need permission from other players before they are allowed to cooperate. The corresponding restricted game takes account of the limited cooperation possibilities by assigning to every coalition the worth of its largest feasible subset. In this paper we provide a polynomial time algorithm for computing the nucleolus of the restricted games corresponding to a class of games with permission structure.
    Keywords: TU-game; nucleolus; game with permission structure; peer group game; information market game; algorithm; complexity
    JEL: C71
    Date: 2008–06–16
  2. By: Alparslan-Gok, S.Z.; Branzei, R.; Tijs, S.H. (Tilburg University, Center for Economic Research)
    Abstract: This paper deals with the research area of cooperative interval games arising from airport situations with interval data. We also extend to airport interval games some results from classical theory.
    Keywords: cooperative interval games;concave games;airport games;cost games;interval data
    JEL: C71
    Date: 2008
  3. By: Yannick Viossat (CEREMADE - CEntre de REcherches en MAthématiques de la DEcision - CNRS : UMR7534 - Université Paris Dauphine - Paris IX)
    Abstract: The dual reduction process, introduced by Myerson, allows to reduce a finite game into a smaller dimensional game such that any equilibrium of the reduced game is an equilibrium of the original game. This holds both for Nash equilibrium and correlated equilibrium. We present examples of applications of dual reduction and argue that this is a useful tool to study Nash equilibria and correlated equilibria. We then investigate its properties.
    Keywords: correlated equilibrium, Nash equilibrium, dual reduction
    Date: 2008–06
  4. By: Wolfgang Eggert (University of Paderborn); Jun-ichi Itaya (Graduate School of Economics and Business Admministration and CESifo, Hokkaido University); Kazuo Mino (Graduate School of Economics, Osaka University)
    Abstract: We introduce a common-pool contest into a continuous-time, differential game setting to model the dynamic behavior of agents facing a trade-off between socially productive activities and appropriation. We are able to identify multiple Markov perfect equilibrium strategies that are nonlinear in a state space, thus leading the economy to a state where epartial cooperationf occurs. We show that such cooperation can be seen as a response to conflict. We also discuss the consequences of changes in the effectiveness of appropriation, the number of contenders, and the rate of time preferences on contest equilibria.
    Keywords: Conflict, Cooperation, Differential Game, Markov Perfect Equilibrium, Nonlinear Markov strategy
    JEL: D74 L
    Date: 2008–07
  5. By: Blanco, Mariana (Royal Holloway, University of London); Engelmann, Dirk (Royal Holloway, University of London); Koch, Alexander K. (Royal Holloway, University of London); Normann, Hans-Theo (Royal Holloway, University of London)
    Abstract: Belief elicitation in economics experiments usually relies on paying subjects according to the accuracy of stated beliefs in addition to payments for other decisions. Such incentives, however, allow risk-averse subjects to hedge with their stated beliefs against adverse outcomes of other decisions in the experiment. This raises two questions: (i) can we trust the existing belief elicitation results, (ii) can we avoid potential hedging confounds? Our results instill confidence regarding both issues. We propose an experimental design that eliminates hedging opportunities, and use this to test for the empirical relevance of hedging effects in the lab. We find no evidence for hedging, comparing the standard “hedging-prone” belief elicitation treatment to a “hedging-proof” design in a sequential prisoners’ dilemma game. Our findings are strengthened by the absence of hedging even in an additional non-belief elicitation treatment using a financial investment frame, where hedging arguably would be most natural.
    Keywords: belief elicitation, hedging, methods, experimental economics
    JEL: C72 C90 G11
    Date: 2008–05

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