The dynamic (in)stability of backwards induction

Article Abstract:

The applicability of backwards induction to finite extensive-form games is examined from the dynamic perspective of evolutionary game theory. The replicator dynamic is used to model the evolutionary basis for predicting the backwards induction solution in combination with rare perturbations that introduce a small change in the proportion of each strategy. The model assumes that general extensive-form games have perfect information but no chance moves in which no player receives the same payoff along two different routes.

Econometrics & Model Building, Econometrics, Equilibrium (Economics), Business models, Induction (Mathematics), Mathematical induction

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Liberalism, efficiency, and stability: some possibility results

Article Abstract:

A study demonstrated that it is possible to create institutional arrangements that can simultaneously be justified in liberal terms and fulfill demands about the efficiency and stability of the outcomes of the processes of decision making within them. Concepts from the game-theory approach to the analysis of rights are used to illustrate this argument. It is argued that legal-political games where individuals have a right to passivity are also stable and efficient.

United States, Decision-making, Decision making, Analysis, Civil rights, Choice (Psychology), Paradox, Social choice, Paradoxes

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