Permanent URL to this publication: http://dx.doi.org/10.5167/uzh-2248
Kosfeld, M; Droste, E; Voorneveld, M (2002). A myopic adjustment process leading to best-reply matching. Games and Economic Behavior, 40(2):270-290.
View at publisher
We analyze a myopic strategy adjustment process in strategic-form games. It is shown that the steady states of the continuous time limit, which is constructed assuming frequent play and slow adjustment of strategies, are exactly the best-reply matching equilibria, as discussed by Droste, Kosfeld, and Voorneveld (2000. Mimeo, Tilburg University). In a best-reply matching equilibrium every player ‘matches’ the probability of playing a pure strategy to the probability that this pure strategy is a best reply to the pure-strategy profile played by his opponents. We derive stability results for the steady states of the continuous time limit in 2×2 bimatrix games and coordination games. Analyzing the asymptotic behavior of the stochastic adjustment process in discrete time shows convergence to minimal curb sets of the game. Moreover, absorbing states of the process correspond to best-reply matching equilibria of the game.
87 downloads since deposited on 11 Feb 2008
29 downloads since 12 months
|Item Type:||Journal Article, refereed|
|Communities & Collections:||03 Faculty of Economics > Department of Economics|
|Dewey Decimal Classification:||330 Economics|
|Uncontrolled Keywords:||Myopic Adjustment, Learning, Matching, Best-reply|
|Deposited On:||11 Feb 2008 12:29|
|Last Modified:||05 Apr 2016 12:22|
Users (please log in): suggest update or correction for this item
Repository Staff Only: item control page