Conjectural Variations in Aggregative Games: An Evolutionary Perspective
AbstractSuppose that in aggregative games, in which a player's payoff depends only on this player's strategy and on an aggregate of all players' strategies, the players are endowed with constant conjectures about the reaction of the aggregate to marginal changes in the player's strategy. The players play the equilibrium determined by their conjectures and equilibrium strategies determine the players' payoffs, which can be different for players with different conjectures. It is shown that with random matching in an infinite population, only consistent conjectures can be evolutionarily stable, where a conjecture is consistent if it is equal to the marginal change in the aggregate at equilibrium, determined by the players' actual best responses. In the finite population case in which relative payoffs matter, only zero conjectures representing aggregate-taking behavior can be evolutionarily stable. The results are illustrated with the examples of a linear-quadratic game (that includes a Cournot oligopoly) and a rent-seeking game.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by University of Nottingham, School of Economics in its series Discussion Papers with number 12/04.
Date of creation:
Date of revision:
Contact details of provider:
Postal: School of Economics University of Nottingham University Park Nottingham NG7 2RD
Phone: (44) 0115 951 5620
Fax: (0115) 951 4159
Web page: http://www.nottingham.ac.uk/economics/
More information through EDIRC
aggregative games; conjectural variations; evolutionary stability JEL classification: C72; D84;
Find related papers by JEL classification:
- evo - - - - - -
- sta - - - - - -
- JEL - Labor and Demographic Economics - - - - -
- cla - - - - - -
- C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
- D84 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Expectations; Speculations
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Corchon, Luis C., 1994. "Comparative statics for aggregative games the strong concavity case," Mathematical Social Sciences, Elsevier, vol. 28(3), pages 151-165, December.
- Dixon, Huw D. & Somma, Ernesto, 2003.
"The evolution of consistent conjectures,"
Journal of Economic Behavior & Organization,
Elsevier, vol. 51(4), pages 523-536, August.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ().
If references are entirely missing, you can add them using this form.