Adjustment Dynamics and Rational Play in Games
AbstractWhen a strategic situation arises repeatedly, the possibility arises that equilibrium predictions can be justified by a dynamic adjustment process. We examine myopic adjustment dynamics, a class that includes replicator dynamics from evolutionary game theory, simple models of imitation, models of experimentation and adjustment, and some simple learning dynamics. We present a series of theorems showing conditions under which behavior that is asymptotically stable under some such dynamic is strategically stable (Kohlberg and Mertens ). This behavior is thus as if the agents in the economy satisfied the extremely stringent assumptions that game theory traditionally makes about rationality and beliefs.
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Bibliographic InfoPaper provided by David K. Levine in its series Levine's Working Paper Archive with number 456.
Date of creation: 09 Dec 2010
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Other versions of this item:
- Jeroen M. Swinkels, 1991. "Adjustment Dynamics and Rational Play in Games," Discussion Papers, Northwestern University, Center for Mathematical Studies in Economics and Management Science 1001, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
- C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
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- Hillas, John, 1990. "On the Definition of the Strategic Stability of Equilibria," Econometrica, Econometric Society, Econometric Society, vol. 58(6), pages 1365-90, November.
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