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Learning and selfconfirming equilibria in network games

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  • Battigalli, Pierpaolo
  • Panebianco, Fabrizio
  • Pin, Paolo

Abstract

Consider a set of agents who play a network game repeatedly. Agents may not know the network. They may even be unaware that they are interacting with other agents in a network. Possibly, they just understand that their optimal action depends on an unknown state that is, actually, an aggregate of the actions of their neighbors. In each period, every agent chooses an action that maximizes her instantaneous subjective expected payoff and then updates her beliefs according to what she observes. In particular, we assume that each agent only observes her realized payoff. A steady state of the resulting dynamic is a selfconfirming equilibrium given the assumed feedback.

Suggested Citation

  • Battigalli, Pierpaolo & Panebianco, Fabrizio & Pin, Paolo, 2023. "Learning and selfconfirming equilibria in network games," Journal of Economic Theory, Elsevier, vol. 212(C).
    • Handle: RePEc:eee:jetheo:v:212:y:2023:i:c:s0022053123000960
    DOI: 10.1016/j.jet.2023.105700
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    Cited by:

    1. Mira Frick & Ryota Iijima & Yuhta Ishii, 2018. "Dispersed Behavior and Perceptions in Assortative Societies," Cowles Foundation Discussion Papers 2128R2, Cowles Foundation for Research in Economics, Yale University, revised Oct 2021.
    2. Bochet, Olivier & Faure, Mathieu & Long, Yan & Zenou, Yves, 2020. "Perceived Competition in Networks," CEPR Discussion Papers 15582, C.E.P.R. Discussion Papers.

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    More about this item

    Keywords

    Learning; Selfconfirming equilibrium; Network games; Observability by active players; Shallow conjectures;
    All these keywords.

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
    • D85 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Network Formation

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