Learning to play approximate Nash equilibria in games with many players
Cartwright, Edward (2003) Learning to play approximate Nash equilibria in games with many players. Working Paper. Coventry: University of Warwick, Department of Economics. Warwick economic research papers (No.671).
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We illustrate one way in which a population of boundedly rational individuals can learn to play an approximate Nash equilibrium. Players are assumed to make strategy choices using a combination of imitation and innovation. We begin by looking at an imitation dynamic and provide conditions under which play evolves to an imitation equilibrium; convergence is conditional on the network of social interaction. We then illustrate, through example, how imitation and innovation can complement each other; in particular, we demonstrate how imitation can ‚help a population to learn to play a Nash equilibrium where more rational methods do not. This leads to our main result in which we provide a general class of large game for which the imitation with innovation dynamic almost surely converges to an approximate Nash, imitation equilibrium.
|Item Type:||Working or Discussion Paper (Working Paper)|
|Subjects:||H Social Sciences > HB Economic Theory
Q Science > QA Mathematics
|Divisions:||Faculty of Social Sciences > Economics|
|Library of Congress Subject Headings (LCSH):||Equilibrium (Economics), Imitation, Convergence (Economics), Game theory, Group theory|
|Series Name:||Warwick economic research papers|
|Publisher:||University of Warwick, Department of Economics|
|Place of Publication:||Coventry|
|Official Date:||March 2003|
|Number of Pages:||47|
|Status:||Not Peer Reviewed|
|Access rights to Published version:||Open Access|
 Alos-Ferrer, C., A.B. Ania and K.R. Schenk-Hoppe, 2000, An evolutionary model of Bertrand oligopoly, Games and Economic Behaviour, 33: 1-19.
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