Tenacious selection of Nash equilibrium
Alioğulları, Zeynel Harun and Barlo, Mehmet (2016) Tenacious selection of Nash equilibrium. BE Journal of Theoretical Economics, 16 (2). pp. 633-647. ISSN 1935-1704
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Official URL: http://dx.doi.org/10.1515/bejte-2015-0055
We propose a complexity measure and an associated refinement based on the observation that best responses with more variations call for more precise anticipation. The variations around strategy profiles are measured by considering the cardinalities of players' pure strategy best responses when others' behavior is perturbed. After showing that the resulting selection method displays desirable properties, it is employed to deliver a refinement: the tenacious selection of Nash equilibrium. We prove that it exists; does not have containment relations with perfection, properness, persistence and other refinements; and possesses some desirable features.
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