Non-Additive Beliefs in Solvable Games
... different and intuitively appealing — Nash equilibrium in capacities. It turns out that the capacities used in the new equilibrium are “simple capacities”.2 Hence the more modest requirement: that Nash equilibria in simple capacities should not add any outcomes to the conventional equilibrium set: i ...
... different and intuitively appealing — Nash equilibrium in capacities. It turns out that the capacities used in the new equilibrium are “simple capacities”.2 Hence the more modest requirement: that Nash equilibria in simple capacities should not add any outcomes to the conventional equilibrium set: i ...
pdf
... eliminated. Rather, they assumed that strategies that are weakly dominated occur with infinitesimal (but nonzero) probability. (Formally, this is captured by using an LPS—lexicographically ordered probability sequence.) They define a notion of belief (which they call assumption) appropriate for thei ...
... eliminated. Rather, they assumed that strategies that are weakly dominated occur with infinitesimal (but nonzero) probability. (Formally, this is captured by using an LPS—lexicographically ordered probability sequence.) They define a notion of belief (which they call assumption) appropriate for thei ...
Modal Logic for Open Minds - Institute for Logic, Language and
... Remark (Notation). In many passages in these lectures, I will denote arbitrary propositions by proposition letters p, q, . . . but sometimes also by capital letters A, B, . . . or Greek symbols ϕ, ψ, . . .. This practice is not very consistent, but most readers should agree that it is nice to have d ...
... Remark (Notation). In many passages in these lectures, I will denote arbitrary propositions by proposition letters p, q, . . . but sometimes also by capital letters A, B, . . . or Greek symbols ϕ, ψ, . . .. This practice is not very consistent, but most readers should agree that it is nice to have d ...
Price Competition in the Market for Lemons
... by price is no longer obvious. In this paper, we would like to understand how the signaling role of the price is a¤ected by price competition. We consider a model of price competition among multiple sellers with asymmetric information. Each seller has an indivisible good, and the quality of the goo ...
... by price is no longer obvious. In this paper, we would like to understand how the signaling role of the price is a¤ected by price competition. We consider a model of price competition among multiple sellers with asymmetric information. Each seller has an indivisible good, and the quality of the goo ...
Optimal Organization of Financial Intermediaries
... projects that are known to be type h. Then, as Laux (2001) has demonstrated, in equilibrium the intermediary makes qualitative asset transformation. The contract that the intermediary agrees with the investors is debt, leaving the intermediary nothing when only one project succeeds. Next, consider w ...
... projects that are known to be type h. Then, as Laux (2001) has demonstrated, in equilibrium the intermediary makes qualitative asset transformation. The contract that the intermediary agrees with the investors is debt, leaving the intermediary nothing when only one project succeeds. Next, consider w ...
Lecture notes - MIT OpenCourseWare
... Both dominant-strategy equilibrium and rationalizability are well-founded solution concepts. If players are rational and they are cautious in the sense that they assign positive probability to each of the other players’ strategies, then we would expect that the players to play according to the domin ...
... Both dominant-strategy equilibrium and rationalizability are well-founded solution concepts. If players are rational and they are cautious in the sense that they assign positive probability to each of the other players’ strategies, then we would expect that the players to play according to the domin ...
The Ally Principle and Bureaucratic Structure
... and a random shock, "; into an outcome. It is assumed that, for all "0 and x0 ; there exists a unique p such that x0 = g(p; "0 ). The principal only knows the distribution of outcomes of a given policy, F (x j p); while every member of available institutions is fully informed about ...
... and a random shock, "; into an outcome. It is assumed that, for all "0 and x0 ; there exists a unique p such that x0 = g(p; "0 ). The principal only knows the distribution of outcomes of a given policy, F (x j p); while every member of available institutions is fully informed about ...
Profitability of price and quantity strategies in an oligopoly
... The firms are identical except for their strategy choice, and (direct and inverse) demand functions are symmetric. We consider four equilibrium configurations in the second stage of the game corresponding to the strategy choice of the firms in the first stage as follows. 1. The Bertrand equilibrium: ...
... The firms are identical except for their strategy choice, and (direct and inverse) demand functions are symmetric. We consider four equilibrium configurations in the second stage of the game corresponding to the strategy choice of the firms in the first stage as follows. 1. The Bertrand equilibrium: ...
A Counting Logic for Structure Transition Systems - RWTH
... Combinations of temporal and state logics, as the ones above, allow to express interesting properties of structure transition systems, but, since the formulas of these logics are Boolean, they are limited to yes-or-no answers. For example, it is not possible to ask “how high will the stack get on al ...
... Combinations of temporal and state logics, as the ones above, allow to express interesting properties of structure transition systems, but, since the formulas of these logics are Boolean, they are limited to yes-or-no answers. For example, it is not possible to ask “how high will the stack get on al ...
Solving a Dynamic Adverse Selection Model Through Finite Policy
... The principal-agent model with hidden information (or adverse selection) provides a powerful tool for analyzing bilateral interactions tangled with asymmetric information. The literature on single-period adverse selection problems is vast (see e.g., the textbooks by Fudenberg and Tirole 1991, Laffon ...
... The principal-agent model with hidden information (or adverse selection) provides a powerful tool for analyzing bilateral interactions tangled with asymmetric information. The literature on single-period adverse selection problems is vast (see e.g., the textbooks by Fudenberg and Tirole 1991, Laffon ...
UNIVERSAL TYPE STRUCTURES WITH
... choose the best action, an agent has to reason about the reasoning of others, their reasoning about the reasoning of others, and so on to arbitrarily high order. With complete information, this infinite regress can be avoided by imposing a fixed-point equilibrium concept, but with incomplete informa ...
... choose the best action, an agent has to reason about the reasoning of others, their reasoning about the reasoning of others, and so on to arbitrarily high order. With complete information, this infinite regress can be avoided by imposing a fixed-point equilibrium concept, but with incomplete informa ...
LEADER-FOLLOWER GAMES - Kyoto University Research
... 1. Introduction. As a solid mathematical methodology to deal with many social problems, such as economics, management and political science, game theory studies the strategic solutions, where an individual makes a choice by taking into account the others’ choices. Game theory was developed widely in ...
... 1. Introduction. As a solid mathematical methodology to deal with many social problems, such as economics, management and political science, game theory studies the strategic solutions, where an individual makes a choice by taking into account the others’ choices. Game theory was developed widely in ...
The Fixed-Price Auction
... In general, single-parameter settings are pretty well understood: A single-parameter mechanism is truthful if and only if it is monotone ...
... In general, single-parameter settings are pretty well understood: A single-parameter mechanism is truthful if and only if it is monotone ...
Axiomatizing first order consequences in dependence logic
... where Var(ti ) is the set of variables occurring in the term ti . If Fr(φ) = ∅, we call φ a sentence. In order to define the semantics of D, we first need to define the concept of a team. Let A be a model with domain A. Assignments of A are finite mappings from variables into A. The value of a term ...
... where Var(ti ) is the set of variables occurring in the term ti . If Fr(φ) = ∅, we call φ a sentence. In order to define the semantics of D, we first need to define the concept of a team. Let A be a model with domain A. Assignments of A are finite mappings from variables into A. The value of a term ...
NBER AND IN AN ECONOMY WITH Mark
... will be non-negative. Overall, the environment is rigged so that in the absence of informational asymmetries production each period depends only on current ...
... will be non-negative. Overall, the environment is rigged so that in the absence of informational asymmetries production each period depends only on current ...
paper - Economics and Accounting at Hunter College
... tax system with nonlinear income and capital taxes, where income taxes depend on the realized human capital shock. Higher ability agents also face a higher marginal savings tax rate to deter them from self insuring against their consumption risk. When the utility function is additively separable in ...
... tax system with nonlinear income and capital taxes, where income taxes depend on the realized human capital shock. Higher ability agents also face a higher marginal savings tax rate to deter them from self insuring against their consumption risk. When the utility function is additively separable in ...
Context$Dependent Forward Induction Reasoning
... Note, RCSBR (and so forward induction reasoning) depends, in somewhat subtle ways, on the particular (extensive-form) epistemic type structure studied. (See Section 3.4 in [7, 2002].) To see this, let’s again consider BoS with an Outside Option, now played in a society that has come to form a “lady ...
... Note, RCSBR (and so forward induction reasoning) depends, in somewhat subtle ways, on the particular (extensive-form) epistemic type structure studied. (See Section 3.4 in [7, 2002].) To see this, let’s again consider BoS with an Outside Option, now played in a society that has come to form a “lady ...
Maximin Rational Expectations Equilibrium
... paradigm itself. Indeed, important criticisms of Savage (1954)’s expected utility theory go back to Allais (1953), Ellsberg (1961) and others. However, no criticism has substantial impact without an alternative. To this date, the most successful alternative to Bayesianism is the Maximin Expected Uti ...
... paradigm itself. Indeed, important criticisms of Savage (1954)’s expected utility theory go back to Allais (1953), Ellsberg (1961) and others. However, no criticism has substantial impact without an alternative. To this date, the most successful alternative to Bayesianism is the Maximin Expected Uti ...
Chapter 9: Reflective Reason and Equilibrium Refinements
... In previous chapters, we have stressed the need for a social epistemology to account for the behaviorl of rational agents in complex social interactions. However, there are many relatively simple interactions in which we can use some form of reflective reason to infer how in individuals will play. S ...
... In previous chapters, we have stressed the need for a social epistemology to account for the behaviorl of rational agents in complex social interactions. However, there are many relatively simple interactions in which we can use some form of reflective reason to infer how in individuals will play. S ...
Lecture 11
... algorithms are empirically tested over characteristic functions with different properties: 1) subadditive, 2) superadditive, 3) picked from a uniform distribution in [0, 1] or in [0, |S|] (where |S| is the size of the coalition). The performance of the heuristics differs over the different type of v ...
... algorithms are empirically tested over characteristic functions with different properties: 1) subadditive, 2) superadditive, 3) picked from a uniform distribution in [0, 1] or in [0, |S|] (where |S| is the size of the coalition). The performance of the heuristics differs over the different type of v ...
NBER WORKING PAPER SERIES INTERTEMPORAL DISTORTIONS IN THE SECOND BEST Stefania Albanesi
... best economies, we propose a unified framework that encompasses and extends many well known models. We allow for a general formulation of the constraints on resource allocation, which we refer to as admissibility constraints. We can capture variants of the Ramsey taxation model with aggregate or idi ...
... best economies, we propose a unified framework that encompasses and extends many well known models. We allow for a general formulation of the constraints on resource allocation, which we refer to as admissibility constraints. We can capture variants of the Ramsey taxation model with aggregate or idi ...
Complexity of Finding a Nash Equilibrium
... to a truth assignment and both players randomizing uniformly with weight 1/n among these literals. The average payoff for both players would be 2. If both players play a clause, then let them both receive a payoff of 2. Finally, let us define the payoffs when one player plays a literal, and the other p ...
... to a truth assignment and both players randomizing uniformly with weight 1/n among these literals. The average payoff for both players would be 2. If both players play a clause, then let them both receive a payoff of 2. Finally, let us define the payoffs when one player plays a literal, and the other p ...
Nash Q-Learning for General-Sum Stochastic Games
... Whereas it is possible to apply Q-learning in a straightforward fashion to each agent in a multiagent system, doing so (as recognized in several of the studies cited above) neglects two issues specific to the multiagent context. First, the environment consists of other agents who are similarly adapt ...
... Whereas it is possible to apply Q-learning in a straightforward fashion to each agent in a multiagent system, doing so (as recognized in several of the studies cited above) neglects two issues specific to the multiagent context. First, the environment consists of other agents who are similarly adapt ...
Equilibrium payoffs in a Bertrand-Edgeworth model
... in the presence of capacity constraints and product differentiation. This is precisely the aim of the present note. We consider a Hotelling duopoly model pricing game with fixed locations. We assume that one firm is possibly capacity constrained while the other holds an abritrarily large capacity. F ...
... in the presence of capacity constraints and product differentiation. This is precisely the aim of the present note. We consider a Hotelling duopoly model pricing game with fixed locations. We assume that one firm is possibly capacity constrained while the other holds an abritrarily large capacity. F ...
Evolution leads to Kantian morality
... We will henceforth consider as given such a game in material payo§s. Let F denote the ...
... We will henceforth consider as given such a game in material payo§s. Let F denote the ...