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Finite Memory Distributed Systems

Author

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  • Dorofeenko, Victor

    (Department of Economics and Finance, Institute for Advanced Studies, Vienna, Austria)

  • Shorish, Jamsheed

    (Department of Economics and Finance, Institute for Advanced Studies, Vienna, Austria)

Abstract

A distributed system model is studied, where individual agents play repeatedly against each other and change their strategies based upon previous play. It is shown how to model this environment in terms of continuous population densities of agent types. A complication arises because the population densities of different strategies depend upon each other not only through game payoffs, but also through the strategy distributions themselves. In spite of this, it is shown that when an agent imitates the strategy of his previous opponent at a sufficiently high rate, the system of equations which governs the dynamical evolution of agent populations can be reduced to one equation for the total population. In a sense, the dynamics 'collapse' to the dynamics of the entire system taken as a whole, which describes the behavior of all types of agents. We explore the implications of this model, and present both analytical and simulation results.

Suggested Citation

  • Dorofeenko, Victor & Shorish, Jamsheed, 2006. "Finite Memory Distributed Systems," Economics Series 190, Institute for Advanced Studies.
    • Handle: RePEc:ihs:ihsesp:190
    as

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    File URL: https://irihs.ihs.ac.at/id/eprint/1708
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    References listed on IDEAS

    as
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    2. Tesfatsion, Leigh & Judd, Kenneth L., 2006. "Handbook of Computational Economics, Vol. 2: Agent-Based Computational Economics," Staff General Research Papers Archive 10368, Iowa State University, Department of Economics.
    3. Dorofeenko, Victor & Shorish, Jamsheed, 2005. "Partial differential equation modelling for stochastic fixed strategy distributed systems," Journal of Economic Dynamics and Control, Elsevier, vol. 29(1-2), pages 335-367, January.
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    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Fixed strategy; Prisoner's dilemma; Fokker-Plank; Distributed system;
    All these keywords.

    JEL classification:

    • C61 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Optimization Techniques; Programming Models; Dynamic Analysis
    • C73 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Stochastic and Dynamic Games; Evolutionary Games

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