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Evolutionary Stable Solution Concepts for the Initial Play

Author

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  • Terje Lensberg
  • Klaus Reiner Schenk-Hoppe

Abstract

We model initial play in bimatrix games by a large population of agents. The agents have individual solution concepts (maps from games to strategy profiles) that they use to solve games. In contrast to evolutionary game theory, where the agents play the same game indefinitely, we consider a setting where they never play the same game twice. Individual solution concepts are represented as computer programs which develop over time by a process of natural selection. We derive an aggregate solution concept (ASC), which converges to a stochastically stable state where the population mean behavior remains constant. The logic and performance of the evolutionary stable ASC is examined in detail, and its solutions to many well-known games are held up against the theoretical and empirical evidence. For example, the ASC selects the “right” solution to traveler’s dilemma games, and predicts that the responder will get 40% of the pie in ultimatum games.

Suggested Citation

  • Terje Lensberg & Klaus Reiner Schenk-Hoppe, 2019. "Evolutionary Stable Solution Concepts for the Initial Play," Economics Discussion Paper Series 1916, Economics, The University of Manchester.
    • Handle: RePEc:man:sespap:1916
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    More about this item

    JEL classification:

    • C63 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computational Techniques
    • C73 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Stochastic and Dynamic Games; Evolutionary Games
    • C90 - Mathematical and Quantitative Methods - - Design of Experiments - - - General

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