My bibliography  Save this paper

Contemporaneous Perfect Epsilon-Equilibria

Author

Listed:
• George Mailath

() (Department of Economics, University of Pennsylvania)

• Andrew Postlewaite

() (Department of Economics, University of Pennsylvania)

• Larry Samuelson

() (Department of Economics, University of Wisconsin-Madison)

Abstract

We examine contemporaneous perfect epsilon-equilibria, in which a player’s actions after every history, evaluated at the point of deviation from the equilibrium, must be within epsilon of a best response. This concept implies, but is stronger than, Radner’s ex ante perfect epsilon-equilibrium. A strategy profile is a contemporaneous perfect epsilon-equilibrium of a game if it is a subgame perfect equilibrium in a perturbed game with nearly the same payoffs, with the converse holding for pure equilibria.

Suggested Citation

• George Mailath & Andrew Postlewaite & Larry Samuelson, 2003. "Contemporaneous Perfect Epsilon-Equilibria," PIER Working Paper Archive 03-021, Penn Institute for Economic Research, Department of Economics, University of Pennsylvania.
• Handle: RePEc:pen:papers:03-021
as

File URL: http://economics.sas.upenn.edu/system/files/working-papers/03-021.pdf

References listed on IDEAS

as
1. Rubinstein, Ariel, 1982. "Perfect Equilibrium in a Bargaining Model," Econometrica, Econometric Society, vol. 50(1), pages 97-109, January.
2. Radner, Roy, 1981. "Monitoring Cooperative Agreements in a Repeated Principal-Agent Relationship," Econometrica, Econometric Society, vol. 49(5), pages 1127-1148, September.
3. Drew Fudenberg & David Levine, 2008. "Limit Games and Limit Equilibria," World Scientific Book Chapters,in: A Long-Run Collaboration On Long-Run Games, chapter 2, pages 21-39 World Scientific Publishing Co. Pte. Ltd..
4. Borgers, Tilman, 1991. "Upper hemicontinuity of the correspondence of subgame-perfect equilibrium outcomes," Journal of Mathematical Economics, Elsevier, vol. 20(1), pages 89-106.
5. Ehud Lehrer & Sylvain Sorin, 1998. "-Consistent equilibrium in repeated games," International Journal of Game Theory, Springer;Game Theory Society, vol. 27(2), pages 231-244.
6. Borgers, Tilman, 1989. "Perfect equilibrium histories of finite and infinite horizon games," Journal of Economic Theory, Elsevier, vol. 47(1), pages 218-227, February.
7. Drew Fudenberg & David Levine, 2008. "Subgame–Perfect Equilibria of Finite– and Infinite–Horizon Games," World Scientific Book Chapters,in: A Long-Run Collaboration On Long-Run Games, chapter 1, pages 3-20 World Scientific Publishing Co. Pte. Ltd..
8. Watson Joel, 1994. "Cooperation in the Infinitely Repeated Prisoners' Dilemma with Perturbations," Games and Economic Behavior, Elsevier, vol. 7(2), pages 260-285, September.
9. Kohlberg, Elon & Mertens, Jean-Francois, 1986. "On the Strategic Stability of Equilibria," Econometrica, Econometric Society, vol. 54(5), pages 1003-1037, September.
10. Drew Fudenberg & Jean Tirole, 1991. "Game Theory," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262061414, January.
11. Radner, Roy, 1980. "Collusive behavior in noncooperative epsilon-equilibria of oligopolies with long but finite lives," Journal of Economic Theory, Elsevier, vol. 22(2), pages 136-154, April.
Full references (including those not matched with items on IDEAS)

Citations

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
as

Cited by:

1. Barlo, Mehmet & Carmona, Guilherme, 2007. "One - Memory in Repeated Games," FEUNL Working Paper Series wp500, Universidade Nova de Lisboa, Faculdade de Economia.
2. Jackson, Matthew O. & Rodriguez-Barraquer, Tomas & Tan, Xu, 2012. "Epsilon-equilibria of perturbed games," Games and Economic Behavior, Elsevier, vol. 75(1), pages 198-216.
3. repec:eee:jetheo:v:169:y:2017:i:c:p:145-169 is not listed on IDEAS
4. Felix Kubler & Karl Schmedders, 2003. "Approximate Versus Exact Equilibria," Discussion Papers 1382, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
5. Elena Parilina & Georges Zaccour, 2016. "Strategic Support of Node-Consistent Cooperative Outcomes in Dynamic Games Played Over Event Trees," International Game Theory Review (IGTR), World Scientific Publishing Co. Pte. Ltd., vol. 18(02), pages 1-16, June.
6. Schlag, Karl H. & Zapechelnyuk, Andriy, 2017. "Dynamic benchmark targeting," Journal of Economic Theory, Elsevier, vol. 169(C), pages 145-169.
7. Karl Schlag & Andriy Zapechelnyuk, 2009. "Decision Making in Uncertain and Changing Environments," Discussion Papers 19, Kyiv School of Economics.
8. Martin, Simon & Schlag, Karl, 2017. "Finite Horizon Holdup and How to Cross the River," Annual Conference 2017 (Vienna): Alternative Structures for Money and Banking 168136, Verein für Socialpolitik / German Economic Association.
9. János Flesch & Arkadi Predtetchinski, 2016. "On refinements of subgame perfect $$\epsilon$$ ϵ -equilibrium," International Journal of Game Theory, Springer;Game Theory Society, vol. 45(3), pages 523-542, August.

Keywords

Epsilon equilibrium; ex ante payoff; multistage game; subgame perfect equilibrium;

JEL classification:

• C70 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - General
• C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
• C73 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Stochastic and Dynamic Games; Evolutionary Games

NEP fields

This paper has been announced in the following NEP Reports:

Corrections

All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pen:papers:03-021. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Dolly Guarini). General contact details of provider: http://edirc.repec.org/data/deupaus.html .

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.