Iterated potential and robustness of equilibria (Q2271379)
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English | Iterated potential and robustness of equilibria |
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Iterated potential and robustness of equilibria (English)
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7 August 2009
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This very extensive paper introduces the readers into the strongly complicated problem of robustness of equilibria in the context of different iterated procedures. In the first part of the paper, the considerations are based on a fixed \(n\)-person finite game with the set \(I=\{1,\dots,n\}\) of players, and linearly ordered finite sets \(A_i\) of the players' actions, \(i\in A\). A one-shot complete information game is identified with a profile of payoff functions \(g=(g_i)_{i\in I}\), where \(g_i: A=\prod_{i\in I} A_i \rightarrow R\) is the payoff functions for player \(i\). For such a game, several new concepts of a solution set \(S^*\subset A\) are considered, like iterated MP-maximizer set, iterated strict MP-maximizer set, iterated strict LP-maximizer set, iterated strict \textbf{p}-dominant equilibrium, iterated strict MP-maximizer set with monotone potential functions, iterated strict pairwise \textbf{p}-dominant equilibrium and iterated risk-dominant equilibrium. The authors study these solution concepts and get several results about possible correlations between them. In the second part of the paper another concept of robust equilibrium is proposed. It is based on a class of incomplete information games, in which each player \(i\in I\) has a countable set of types. Two main results obtained here say about correlations between robust equilibria and iterated MP-maximizer sets and iterated strict \textbf{p}-dominant equilibria. The third part considers the problem of stability of iterated MP-maximizer sets in the context of such properties of multistrategies \(a^*\in A\) like global accessibility and linearly absorbing. The results of the paper are widely discussed and illustrated by several examples.
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equilibrium selection
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robustness
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incomplete information
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perfect foresight dynamics
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iteration
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monotone potential
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p-dominance
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