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A tractable evolutionary model for the Minority Game with asymmetric payoffs

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  • Dindo, Pietro

Abstract

We set up a simple behavioral model for a large population of agents who are repeatedly playing the Minority Game and whose interaction is modeled by means of the so-called replicator dynamics. This allows us to specify the dynamics of the aggregate variables, the number of agents choosing each side, in terms of a low-dimensional dynamical system that gives qualitatively the same results of the existing computational approaches. As an extension we introduce asymmetric payoffs, i.e., we analyze the case where the minority and majority payoffs are side dependent. In this case the fluctuations out of the equilibrium are qualitatively different. In particular, contrary to the previous case, they are associated with a difference in the average payoff gained by each side. Furthermore, a parameter region exists where the dynamics does not converge to any isolated periodic attractor.

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  • Dindo, Pietro, 2005. "A tractable evolutionary model for the Minority Game with asymmetric payoffs," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 355(1), pages 110-118.
    • Handle: RePEc:eee:phsmap:v:355:y:2005:i:1:p:110-118
    DOI: 10.1016/j.physa.2005.02.073
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    1. Arthur, W Brian, 1994. "Inductive Reasoning and Bounded Rationality," American Economic Review, American Economic Association, vol. 84(2), pages 406-411, May.
    2. Jorgen W. Weibull, 1997. "Evolutionary Game Theory," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262731215, December.
    3. W. Brian Arthur, 1994. "Inductive Reasoning, Bounded Rationality and the Bar Problem," Working Papers 94-03-014, Santa Fe Institute.
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    Cited by:

    1. Bischi, Gian Italo & Merlone, Ugo & Pruscini, Eros, 2018. "Evolutionary dynamics in club goods binary games," Journal of Economic Dynamics and Control, Elsevier, vol. 91(C), pages 104-119.
    2. Gian Italo Bischi & Ugo Merlone, 2017. "Evolutionary minority games with memory," Journal of Evolutionary Economics, Springer, vol. 27(5), pages 859-875, November.

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