Better-Reply Dynamics with Bounded Recall
AbstractA decision maker is engaged in a repeated interaction with Nature. The objective of the decision maker is to guarantee to himself the average payoff as large as the best-reply payoff to Nature's empirical distribution of play, no matter what Nature does. The decision maker with perfect recall can achieve this objective by a simple better-reply strategy. In this paper we demonstrate that the relationship between perfect recall and bounded recall is not straightforward: The decision maker with bounded recall may fail to achieve this objective, no matter how long recall he has and no matter what better-reply strategy he employs.
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Bibliographic InfoPaper provided by Kyiv School of Economics in its series Discussion Papers with number 2.
Date of creation: Jan 2008
Date of revision: Mar 2008
Note: Published in Mathematics of Operations Research, 33, 869-879 (2008)
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Better-reply dynamics; regret; bounded recall; fictitious play; approachability;
Find related papers by JEL classification:
- C73 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Stochastic and Dynamic Games; Evolutionary Games
- D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty
- D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search, Learning, and Information
This paper has been announced in the following NEP Reports:
- NEP-ALL-2008-02-09 (All new papers)
- NEP-CBE-2008-02-09 (Cognitive & Behavioural Economics)
- NEP-EVO-2008-02-09 (Evolutionary Economics)
- NEP-GTH-2008-02-09 (Game Theory)
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