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Cautious farsighted stability in network formation games with streams of payoffs

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  • Mariya Teteryatnikova

    (National Research University Higher School of Economics
    WU-Vienna University of Economics and Business)

Abstract

We propose a new notion of farsighted pairwise stability for dynamic network formation which includes two notable features: consideration of intermediate payoffs and cautiousness. This differs from existing concepts which typically consider either only immediate or final payoffs, and which often require that players are optimistic in any environment without full communication and commitment. For arbitrary (and possibly heterogeneous) preferences over the process of network formation, a non-empty cautious path stable set of networks always exists. Furthermore, some general relationships exist between cautious path stability and other farsighted concepts.

Suggested Citation

  • Mariya Teteryatnikova, 2021. "Cautious farsighted stability in network formation games with streams of payoffs," International Journal of Game Theory, Springer;Game Theory Society, vol. 50(4), pages 829-865, December.
    • Handle: RePEc:spr:jogath:v:50:y:2021:i:4:d:10.1007_s00182-021-00771-3
    DOI: 10.1007/s00182-021-00771-3
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    Cited by:

    1. Mariya Teteryatnikova & James Tremewan, 2015. "Stability in Network Formation Games with Streams of Payoffs: An Experimental Study," Vienna Economics Papers 1508, University of Vienna, Department of Economics.
    2. Mariya Teteryatnikova & James Tremewan, 2015. "Stability in Network Formation Games with Streams of Payoffs: An Experimental Study," Vienna Economics Papers vie1508, University of Vienna, Department of Economics.
    3. Herings, P.J.J. & Khan, Abhimanyu, 2022. "Network Stability under Limited Foresight," Other publications TiSEM 03f2ece9-902b-4dba-a16e-0, Tilburg University, School of Economics and Management.
    4. Mariya Teteryatnikova & James Tremewan, 2020. "Myopic and farsighted stability in network formation games: an experimental study," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 69(4), pages 987-1021, June.

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    More about this item

    Keywords

    Network stability; Farsighted and cautious players; Improving paths; Heterogeneous preferences;
    All these keywords.

    JEL classification:

    • D85 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Network Formation
    • A14 - General Economics and Teaching - - General Economics - - - Sociology of Economics
    • C71 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Cooperative Games

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