A Quantal Response Equilibrium Model of Order Statistic Games
This paper applies quantal response equilibrium (QRE) models (McKelvey and Palfrey, Games and Economic Behavior 10 (1995), 6-38) to a wide class of symmetric coordination games in which each player's best response is determined by an order statistic of all players' decisions, as in the classic experiments of Van Huyck, Battalio, and Beil (American Economic Review 80 (1990), 234-248; Quarterly Journal of Economics 106 (1991), 885-910), but players have a bounded continuum of decisions, which approximates to Van Huyck, Battalio, and Rankin's (1996) environment. Generalizing the results of Anderson, Goeree, and Holt (1998) with a quadratic payoff function, I show that as the noise vanishes the QRE approaches the most efficient equilibrium as a unique limit for all order statistics, including the minimum.
|Date of creation:||01 Aug 1999|
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- Carlsson, Hans, 1991. "A Bargaining Model Where Parties Make Errors," Econometrica, Econometric Society, vol. 59(5), pages 1487-1496, September.
- Carlsson, Hans & Ganslandt, Mattias, 1998.
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- Carlsson, H. & van Damme, E.E.C., 1990.
"Global games and equilibrium selection,"
1990-52, Tilburg University, Center for Economic Research.
- Carlsson, H. & van Damme, E.E.C., 1993. "Global games and equilibrium selection," Other publications TiSEM 49a54f00-dcec-4fc1-9488-4, Tilburg University, School of Economics and Management.
- Carlsson, H. & Van Damme, E., 1990. "Global Games And Equilibrium Selection," Papers 9052, Tilburg - Center for Economic Research.
- Hans Carlsson & Eric van Damme, 1993. "Global Games and Equilibrium Selection," Levine's Working Paper Archive 122247000000001088, David K. Levine.
- Chen, H.-C. & Friedman, J. W. & Thisse, J.-F., "undated".
"Boundedly rational Nash equilibrium: a probabilistic choice approach,"
CORE Discussion Papers RP
1248, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- Chen, Hsiao-Chi & Friedman, James W. & Thisse, Jacques-Francois, 1997. "Boundedly Rational Nash Equilibrium: A Probabilistic Choice Approach," Games and Economic Behavior, Elsevier, vol. 18(1), pages 32-54, January.
- CHEN, Hsiao-Ch. & FRIEDMAN, J.W. & THISSE, Jacques-Francois, 1996. "Boundedly Rational Nash Equilibrium: A Probabilistic Choice Approach," CORE Discussion Papers 1996044, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- Carlsson, H. & Van Dame, E., 1991. "Equilibrium Selection in Stag Hunt Games," Papers 9170, Tilburg - Center for Economic Research.
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