Abstracts » Economics

Epistemic conditions for equilibrium in beliefs without independence

Article Abstract:

Sufficient conditions on the knowledge of the players in a game for their beliefs to constitute a Nash equilibrium are demonstrated. A major assumption is mutual knowledge of rationality, wherein players must know that everybody is rational. Player rationality means that his chosen action maximizes his expected utility, considering his beliefs; however, the concept of rationality need not be restricted to expected utility maximization. Aumann and Brandenburger's sufficient conditions can be generalized to the case where players' preferences over uncertain outcomes belong to a large class of non-expected utility preferences.

Rational expectations (Economics)

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Communication in repeated games with private monitoring

Article Abstract:

Simpler equilibria can be applied to achieve cooperation in private monitoring of repeated games. This was gleaned from an examination of repeated games, where each player can be observed by only a subset of the other players, and where players can publicly announce the behavior of those players they observed. The limit set of sequential equilibrium payoffs, when the discount factor tends to one, has the set of individual rational payoffs whenever at least two other players monitor each player. A payoff which is a strict mutual threat point is an equilibrium outcome even when each player has only one monitor.

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Correlation without mediation: expanding the set of equilibrium outcomes by 'cheap' pre-play procedures

Article Abstract:

A study of the correlated equilibrium distribution on the set of outcomes of a game that is influence by a set of pre-play procedures that is not mediated showed that two distinct Nash equilibrium payoffs are generated for each player in the game. Each of the player can expect a payoff that is an improvement over the worst Nash equilibrium payoff, if the correlated equilibrium distribution consist of probabilities that are rational numbers and the equilibrium distribution is implemented in a sequential equilibrium of an extended game.

Models, Economic research

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