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on Game Theory |
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Issue of 2014‒02‒15
eight papers chosen by Laszlo A. Koczy Hungarian Academy of Sciences and Obuda University |
| By: | Nicolas CARAYOL; Remi DELILLE; Vincent VANNETELBOSCH |
| Abstract: | We propose a concept to study the stability of social and economic networks when players are farsighted and allocations are determined endogenously. A set of networks is a von Neumann-Morgenstern farsightedly stable set with bargaining if there exists an allocation rule and a bargaining threat such that (i) there is no farsighted improving path from one network inside the set to another network inside the set, (ii) from any network outside the set there is a farsighted improving path to some network inside the set, (iii) the value of each network is allocated among players so that players suffer or benefit equally from being linked to each other compared to the allocation they would obtain at their respective credible bargaining threat. We show that the set of strongly efficient networks is the unique von Neumann-Morgenstern farsightedly stable set with bargaining if the allocation rule is anonymous and component efficient and the value function is top convex. Moreover, the componentwise egalitarian allocation rule emerges endogenously. |
| Keywords: | Farsighted players, Stability, Equal bargaining power |
| JEL: | A14 C70 D20 |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:grt:wpegrt:2014-05&r=gth |
| By: | Fuhito Kojima (Stanford University); Parag Pathak (Massachusetts Institute of Technology); Alvin Roth (Stanford University) |
| Abstract: | Accommodating couples has been a longstanding issue in the design of centralized labor market clearinghouses for doctors and psychologists, because couples view pairs of jobs as complements. A stable matching may not exist when couples are present. This paper's main result is that a stable matching exists when there are relatively few couples and preference lists are sufficiently short relative to market size. We also discuss incentives in markets with couples. We relate these theoretical results to the job market for psychologists, in which stable matchings exist for all years of the data, despite the presence of couples. |
| Date: | 2013–04 |
| URL: | http://d.repec.org/n?u=RePEc:sip:dpaper:12-018&r=gth |
| By: | Giacomo Bonanno (Department of Economics, University of California Davis) |
| Abstract: | In Bonanno (Int. J. Game Theory, 42:567-592, 2013) a general notion of perfect Bayesian equilibrium (PBE) was introduced for extensive-form games and shown to be intermediate between subgame-perfect equilibrium and sequential equilibrium. The essential ingredient of the proposed notion is the existence of a plausibility order on the set of histories that rationalizes a given assessment. In this paper we study restrictions on the belief revision policy encoded in a plausibility order and provide necessary and sufficient conditions for a PBE to be a sequential equilibrium. |
| Keywords: | Plausibility order, belief revision, Bayesian updating, independence, sequential equilibrium, consistency |
| JEL: | C7 |
| Date: | 2014–02–04 |
| URL: | http://d.repec.org/n?u=RePEc:cda:wpaper:14-1&r=gth |
| By: | Joachim Rosenmüller (Center for Mathematical Economics, Bielefeld University) |
| Abstract: | This paper constitutes the third part in a series dealing with vNM-Stable Sets, see J. Rosenmüller, "Convex vNM-Stable Sets for a Semi Orthogonal Game. Part I" [IMW Working Paper no. 483 (2013)], "Convex vNM-Stable Sets for a Semi Orthogonal Game. Part II" [IMW Working Paper no. 498 (2014)]. We consider (cooperative) linear production games with a continuum of players. The coalitional function is generated by r + 1 "production factors" (non atomic measures). r factors are given by orthogonal probabilities ("cornered" production factors) while factor r + 1^th is provided "across the corners" of the market. We consider convex vNM-Stable Sets of this game. Within this third part we exhaustively discuss the situation in a small but very significant economy or game. In tis situation, there are two corners of the market (factors represented by orthogonal probabilities), each of which being divided into two sectors of constant density of the non cornered commodity (a measure exhibiting mass across all corners of the market). For short, this is the 2 x 2-case, the foundations of which have been laid in Example 2.1 of Part I [IMW Working Paper no. 483 (2013)]. It turns out that, depending on the boundary conditions, we obtain two different scenarios. The first one reflects a situation that exhibits a unique vNM-Stable Set. The second scenario allows for a variety of vNM-Stable Sets including but not equal to the core of the game. |
| Date: | 2014–01 |
| URL: | http://d.repec.org/n?u=RePEc:bie:wpaper:500&r=gth |
| By: | Joachim Rosenmüller (Center for Mathematical Economics, Bielefeld University) |
| Abstract: | This paper constitutes the second part in a series dealing with vNM-Stable sets for (cooperative) linear production games with a continuum of players, see J. Rosenmüller, "Convex vNM-Stable Sets for a Semi Orthogonal Game. Part I" [IMW Working Paper no. 483 (2013)]. The coalitional function is generated by r + 1 “production factors” (non atomic measures). R factors are given by orthogonal probabilities (“cornered” production factors) while factor r + 1^th is provided “across the corners” of the market. We consider convex vNM-Stable Sets of this game. Within the second part we present an economy reflecting relative abundance of the “central” commodity. In this situation the model allows for a vNM-Stable Set including but not equal to the core of the game. Rather there is an additional imputation such that the vNM-Stable Set is the convex hull of this imputation and the core. This imputation is essentially described by the density of the r + 1^st production factor – mutatis mutandis. |
| Date: | 2014–01 |
| URL: | http://d.repec.org/n?u=RePEc:bie:wpaper:498&r=gth |
| By: | Adam Zylbersztejn (Department of Economics, Vienna University of Economics and Business) |
| Abstract: | Several experimental studies show that ex post communication mitigates opportunistic behavior in social dilemmas. The source of this effect, especially in a repeated interaction, is nonetheless still obscure. This study provides a novel empirical testbed for two channels by which ex post communication may affect behavior in a repeated public goods game. One is related to strategic signaling. The other involves emotions induced by others' expressed disapproval. The presence of ex post communication strongly fosters pro-social behavior. The data do not support the signaling hypothesis, favouring the emotion-based explanation instead. |
| Keywords: | Public goods game, Voluntary Contribution Mechanism, Ex post communication |
| JEL: | C72 D83 |
| Date: | 2014–01 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wiwwuw:wuwp161&r=gth |
| By: | Beckmann, Klaus (Helmut Schmidt University, Hamburg); Reimer, Lennart (Helmut Schmidt University, Hamburg) |
| Abstract: | Using examples for each type of model, we consider dynamic games, differential games, and simulation as alternative ways of extending the standard static economic model of conflict to study patterns of conflict dynamics. It turns out that computational requirements and theoretical difficulties impose tight limits on what can be achieved using the first two approaches. In particular, we are unable to study dynamic military conflict as a series of ``battles'' that are resolved individually. A simulation study based on a new model of adaptive, boundedly rational decision making, however, is shown not to be subject to this limitation. Plausible patterns of conflict dynamics emerge, which we can link to both historical conflict and standard tenets of military theory. |
| Keywords: | conflict; dynamics; contest success functions; differential games; dynamic games; simulation; emergence of war |
| JEL: | C72 D74 |
| Date: | 2014–01–30 |
| URL: | http://d.repec.org/n?u=RePEc:ris:vhsuwp:2014_138&r=gth |
| By: | Kai Lessmann (Potsdam Institute for Climate Impact Research (PIK)); Ulrike Kornek (Potsdam Institute for Climate Impact Research (PIK)); Valentina Bosetti (Università Bocconi and Fondazione Eni Enrico Mattei (FEEM)); Rob Dellink (Environmental Economics and Natural Resources Group, Department of Economics, Wageningen University); Johannes Emmerling (Fondazione Eni Enrico Mattei (FEEM) and Centro Euro-Mediterraneo sui Cambiamenti Climatici (CMCC)); Johan Eyckmans (KU Leuven – Center for Economics and Corporate Sustainability (CEDON)); Miyuki Nagashima (Research Institute of Innovative Technology for the Earth); Hans-Peter Weikard (Environmental Economics and Natural Resources Group, Department of Economics, Wageningen University); Zili Yang (Department of Economics, State University of New York at Binghamton) |
| Abstract: | In this paper we report results from a comparison of numerically calibrated game theoretic integrated assessment models that explore stability and performance of international coalitions for climate change mitigation. Specifically, by means of this ensemble of models we are able to identify robust results concerning incentives of nations to commit themselves to a climate agreement, and to estimate what stable agreements can achieve in terms of greenhouse gas mitigation. We also assess the potential of transfers that redistribute the surplus of cooperation in order to foster stability of climate coalitions. In contrast to much of the existing analytical game theoretical literature, we find substantial scope for self-enforcing climate coalitions in most models that close much of the abatement and welfare gap between complete absence of cooperation and full cooperation. This more positive message follows from the use of transfer schemes that are designed to counteract free riding incentives. |
| Keywords: | Coalition Stability, International Environmental Agreements, Numerical modeling, Transfers |
| JEL: | Q5 Q58 C7 |
| URL: | http://d.repec.org/n?u=RePEc:fem:femwpa:2014.05&r=gth |