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Evolution of Strategies in Repeated Stochastic Games

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  • Anders Eriksson
  • Kristian Lindgren
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    Abstract

    A framework for studying the evolution of cooperative behaviour, using evolution of finite state strategies, is presented. The interaction between agents is modelled by a repeated game with random observable payoffs. The agents are thus faced with a more complex (and general) situation, compared to the Prisoner Õs Dilemma that has been widely used for in- vestigating the conditions for cooperation in evolving populations. Still, there is a robust cooperating strategy that usually evolves in a population of agents. In the cooperative mode, this strategy selects an action that al- lows for maximizing the payoff sum of both players in each round, regard- less of the own payoff. Two such strategies maximize the expected total payoff. If the opponent deviates from this scheme, the strategy invokes a punishment action, which for example could be to aim for the single round Nash equilibrium for the rest of the (possibly infinitely) repeated game. The introduction of mistakes to game actually pushes evolution to more cooperative, even though at first sight, it makes the game more cooperative

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    Bibliographic Info

    Paper provided by Santa Fe Institute in its series Working Papers with number 01-04-023.

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    Date of creation: Apr 2001
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    Handle: RePEc:wop:safiwp:01-04-023

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    1. Dutta Prajit K., 1995. "A Folk Theorem for Stochastic Games," Journal of Economic Theory, Elsevier, vol. 66(1), pages 1-32, June.
    2. Stanley, E.A. & Ashlock, Daniel & Tesfatsion, Leigh, 1994. "Iterated Prisoner's Dilemma with Choice and Refusal of Partners," Staff General Research Papers 11180, Iowa State University, Department of Economics.
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