AbstractWe define an evolutionary process of âeconomic Darwinismâ for playing-the-field, symmetric games. The process captures two forces. One is âeconomic selectionâ: if current behavior leads to payoff differences, behavior yielding lowest payoff has strictly positive probability of being replaced by an arbitrary behavior. The other is âmutationâ: any behavior has at any point in time a strictly positive, very small probability of shifting to an arbitrary behavior. We show that behavior observed frequently is in accordance with âevolutionary equilibriumâ, a static equilibrium concept suggested in the literature. Using this result, we demonstrate that generally under positive (negative) externalities, economic Darwinism implies even more under- (over-) activity than does Nash equilibrium.
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Bibliographic InfoArticle provided by Springer in its journal Theory and Decision.
Volume (Year): 70 (2011)
Issue (Month): 3 (March)
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Web page: http://www.springerlink.com/link.asp?id=100341
Evolutionary game theory; Darwinian evolution; Economic selection; Mutation; Evolutionary equilibrium; Stochastic stability;
Other versions of this item:
- C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
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