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A note on the equilibria of the unbounded traveler’s dilemma

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  • Ispano, Alessandro

Abstract

When there is no upward limit on admissible claims, the traveler’s dilemma admits a continuum of symmetric mixed strategy equilibria in addition to the pure strategy equilibrium in which both players ask and obtain the minimum. The payoff of any of these equilibria exceeds the payoff of the pure strategy one and any claim represents an attainable payoff. If the distinction between a large and an unbounded action set is fuzzy, this result can explain some puzzling stylized facts on the behavior of experimental subjects in the game.

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  • Ispano, Alessandro, 2015. "A note on the equilibria of the unbounded traveler’s dilemma," Mathematical Social Sciences, Elsevier, vol. 77(C), pages 52-54.
  • Handle: RePEc:eee:matsoc:v:77:y:2015:i:c:p:52-54
    DOI: 10.1016/j.mathsocsci.2015.07.001
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    References listed on IDEAS

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