Growth of Strategy Sets, Entropy, and Nonstationary Bounded Recall
The paper initiates the study of long term interactions where players' bounded rationality varies over time. Time dependent bounded rationality, for player i, is reflected in part in the number [psi]i(t) of distinct strategies available to him in the first t-stages. We examine how the growth rate of [psi]i(t) affects equilibrium outcomes of repeated games. An upper bound on the individually rational payoff is derived for a class of two-player repeated games, and the derived bound is shown to be tight. As a special case we study the repeated games with nonstationary bounded recall and show that, a player can guarantee the minimax payoff of the stage game, even against a player with full recall, by remembering a vanishing fraction of the past. A version of the folk theorem is provided for this class of games.
(This abstract was borrowed from another version of this item.)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Robert J. Aumann & Lloyd S. Shapley, 2013.
"Long Term Competition -- A Game-Theoretic Analysis,"
Annals of Economics and Finance,
Society for AEF, vol. 14(2), pages 627-640, November.
- Robert J. Aumann & Lloyd S. Shapley, 1992. "Long Term Competition-A Game Theoretic Analysis," UCLA Economics Working Papers 676, UCLA Department of Economics.
- Neyman, Abraham, 1985. "Bounded complexity justifies cooperation in the finitely repeated prisoners' dilemma," Economics Letters, Elsevier, vol. 19(3), pages 227-229.
- Olivier Gossner & Penélope Hernández & Abraham Neyman, 2006. "Optimal Use of Communication Resources," Econometrica, Econometric Society, vol. 74(6), pages 1603-1636, November.
- Olivier Gossner & Penelope Hernandez & Abraham Neyman, 2004. "Optimal Use of Communication Resources," Discussion Paper Series dp377, The Federmann Center for the Study of Rationality, the Hebrew University, Jerusalem.
- Olivier Gossner & Pénélope Hernández & Abraham Neyman, 2006. "Optimal use of communication resources," Post-Print halshs-00754118, HAL.
- Olivier Gossner & Abraham Neyman & Penélope Hernández, 2005. "Optimal Use Of Communication Resources," Working Papers. Serie AD 2005-06, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie).
- Gossner, Olivier & Vieille, Nicolas, 2002. "How to play with a biased coin?," Games and Economic Behavior, Elsevier, vol. 41(2), pages 206-226, November.
- Gossner, O. & Vieille, N., 1999. "How to play with a biased coin?," Papers 99-31, Paris X - Nanterre, U.F.R. de Sc. Ec. Gest. Maths Infor..
- O. Gossner & N. Vieille, 1999. "How to play with a biased coin ?," THEMA Working Papers 99-31, THEMA (THéorie Economique, Modélisation et Applications), Université de Cergy-Pontoise.
- Olivier Gossner & Nicolas Vieille, 2002. "How to play with a biased coin?," Post-Print hal-00464984, HAL.
- Abraham Neyman & Daijiro Okada, 2000. "Two-person repeated games with finite automata," International Journal of Game Theory, Springer;Game Theory Society, vol. 29(3), pages 309-325.
- Neyman, Abraham & Okada, Daijiro, 2000. "Repeated Games with Bounded Entropy," Games and Economic Behavior, Elsevier, vol. 30(2), pages 228-247, February.
- Ben-Porath Elchanan, 1993. "Repeated Games with Finite Automata," Journal of Economic Theory, Elsevier, vol. 59(1), pages 17-32, February.
- Ben-Porath, E., 1991. "Repeated games with Finite Automata," Papers 7-91, Tel Aviv - the Sackler Institute of Economic Studies.
- Lehrer, Ehud, 1988. "Repeated games with stationary bounded recall strategies," Journal of Economic Theory, Elsevier, vol. 46(1), pages 130-144, October.
- Aumann, Robert J., 1997. "Rationality and Bounded Rationality," Games and Economic Behavior, Elsevier, vol. 21(1-2), pages 2-14, October. Full references (including those not matched with items on IDEAS)