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Evolutionary Learning in Signalling Games

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  • Jacobsen, Hans Jorgen
  • Jensen, Mogens
  • Sloth, Birgitte

Abstract

We study equilibrium selection by evolutionary learning in monotone signalling games. The learning process is a development of that introduced by Young for static games extended to deal with incomplete information and sequential moves; it thus involves stochastic trembles. For vanishing trembles the process gives rise to strong selection among sequential equilibria. If the game has separating equilibria, then in the long run only play according to a specific separating equilibrium, the so-called Riley equilibrium, will be observed frequently. Also if the game has no separating equilibrium a particular behavior will emerge as the only one observed frequently in the long run. It may or may not correspond to a pooling equilibrium, but if it does, it is to one where both types of sender choose the signal that is best for the ''high'' type when all signals are responded to as if they came from the ''low'' type. This selection is stronger than, and only partly in accordance with, traditional selection based on restrictions on ''out-of-equilibrium'' beliefs.
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Suggested Citation

  • Jacobsen, Hans Jorgen & Jensen, Mogens & Sloth, Birgitte, 2001. "Evolutionary Learning in Signalling Games," Games and Economic Behavior, Elsevier, vol. 34(1), pages 34-63, January.
  • Handle: RePEc:eee:gamebe:v:34:y:2001:i:1:p:34-63
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    References listed on IDEAS

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    Cited by:

    1. Ivan Anic & Vladimir Bozin & Branko Uroševic, 2016. "A Signaling Model of University Selection," CESifo Working Paper Series 5741, CESifo Group Munich.
    2. Friedman, Daniel & Singh, Nirvikar, 2009. "Equilibrium vengeance," Games and Economic Behavior, Elsevier, vol. 66(2), pages 813-829, July.
    3. Voorneveld, Mark & Weibull, Jörgen W., 2004. "Prices and quality signals," SSE/EFI Working Paper Series in Economics and Finance 551, Stockholm School of Economics, revised 06 Jul 2004.
    4. Ania, Ana B. & Troger, Thomas & Wambach, Achim, 2002. "An evolutionary analysis of insurance markets with adverse selection," Games and Economic Behavior, Elsevier, vol. 40(2), pages 153-184, August.
    5. Elliott O. Wagner, 2013. "The Dynamics of Costly Signaling," Games, MDPI, Open Access Journal, vol. 4(2), pages 1-19, April.
    6. Friedman, Daniel & Singh, Nirvikar, 2004. "Vengefulness Evolves in Small Groups," Santa Cruz Department of Economics, Working Paper Series qt0xp29105, Department of Economics, UC Santa Cruz.

    More about this item

    JEL classification:

    • C70 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - General
    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games

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