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2 edition of folk theorem in stochastic games with and without discounting found in the catalog.

folk theorem in stochastic games with and without discounting

Ben Lockwood

folk theorem in stochastic games with and without discounting

by Ben Lockwood

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  • 35 Currently reading

Published by Birkbeck College in London .
Written in English


Edition Notes

StatementBen Lockwood.
SeriesDiscussion paper in economics / Birkbeck College -- 90/18
ID Numbers
Open LibraryOL13915373M

The folk theorem is a partial converse of this: A payoff profile is said to be feasible if it lies in the convex hull of the set of possible payoff profiles of the stage game. The folk theorem states that any feasible payoff profile that strictly dominates the minmax profile can . A Folk Theorem for Stochastic Games with Infrequent State Changes,” Theoretical Economics. By Marcin Pęski and Thomas Wiseman. Abstract. Abstract. We characterize perfect public equilibrium payoffs in dynamic stochas-tic games, in the case where the length of the period shrinks, but players ’ rate of time discounting and the transition.

MS&E Lecture 4: Stochastic games Ramesh Johari Ap In this lecture we define stochastic games and Markov perfect equilibrium. 1 Stochastic Games A (discounted) stochastic game with N players consists of the following elements. 1. A state space X (which we assume to be finite for the moment). 2. The blockchain folk theorem. Bruno Biais strategic miners. We show that mining the longest chain is a Markov perfect equilibrium, without forking on the equilibrium path, in line with the seminal vision of Nakamoto (). We also clarify, however, that the blockchain game is a coordination game, which opens the scope for multiple.

rise to stochastic games. See Phelan and Stacchetti (), for example. In Section 6, we shall apply our results to a simple political economy game, and establish a version of the folk theorem when some players are short-run. 2 Notation and Assumptions We introduce stochastic games with public signals. At each stage, the game is in one state. to repeated games, we prove an unre–nable folk theorem: Any individually rational and feasible payo⁄ is the unique rationalizable payo⁄ vector for some perturbed type pro–le. This is true even if perturbed types are restricted to believe that the repeated-game payo⁄ structure and the discount .


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Folk theorem in stochastic games with and without discounting by Ben Lockwood Download PDF EPUB FB2

In game theory, folk theorems are a class of theorems describing an abundance of Nash equilibrium payoff profiles in repeated games (Friedman ). The original Folk Theorem concerned the payoffs of all the Nash equilibria of an infinitely repeated game. This result was called the Folk Theorem because it was widely known among game theorists in the s, even though no one had published it.

In game theory, folk theorems are a class of theorems about possible Nash equilibrium payoff profiles in repeated games (Friedman ). [1] The original Folk Theorem concerned the payoffs of all the Nash equilibria of an infinitely repeated game. This result was called the Folk Theorem because it was widely known among game theorists in the s, even though no one had published it.

An infinitely-repeated game without discounting is often called a "supergame". The folk theorem in this case is very simple and contains no pre-conditions: every IR feasible payoff profile in the basic game is an equilibrium payoff profile in the repeated game.

The proof employs what is called grim or grim trigger strategy. All players start by. In the repeated game, it is possible for players to cooperate with each other, and thus do better. Indeed, the folk theorem for repeated games states that, for a low enough discounting of future. A folk theorem for such games is presented.

The result subsumes a number of results obtained earlier and applies to a wide range of games studied in the economics literature. The result further establishes an underlying unity between stochastic and purely repeated games from the point of view of aspymptotic analysis, even though stochastic Cited by: This paper provides conditions for a limit folk theorem to hold in stochastic games with nite horizon.

If asymptotic assumptions à la Dutta () hold and if, in some nite truncations of. Repeated prisoners dilemma, finite and infinite repeated games, limited-average versus future-discounted reward, folk theorems, stochastic games and learning.

Repeated Games let's talk a little bit about a folk theorem now for this kind of repeated game. So we're in the case where there is a discount factor and people care more about. This paper introduces stochastic games with imperfect public signals.

It provides a sufficient condition for the folk theorem when the game is irreducible, thus generalizing the results of Dutta () and Fudenberg, Levine, and Maskin ().To do this, the paper extends the concept of self-generation (Abreu, Pearce, and Stacchetti, ) to “return generation,” which explicitly tracks.

Abstract. This paper provides assumptions for a limit Folk theorem in stochastic games with finite horizon. In addition to the asymptotic assumptions à la Dutta (J Econ Theory –32, ) I present an additional assumption under which the Folk theorem holds in stochastic games when the horizon is long but assumption says that the limit set of SPE payoffs contains a state.

Repeated Games and the Folk Theorem Lecture 9, Slide 7. RecapRepeated GamesIn nitely Repeated GamesFolk Theorem Perfect Recall This will lead u s to stochastic games in Sectionwhich are like repeated games but do not require that the same normal-form game is played in each time step.

In Section we will co nsider structure. Fudenberg D, Maskin E. Folk Theorem for Repeated Games with Discounting or with Incomplete Information. Econometrica. ; Fudenberg D, Yamamoto Y.

The Folk Theorem for Irreducible Stochastic Games with Imperfect Public Monitoring. Journal of Economic Theory. ; Downloadable. We characterize perfect public equilibrium payoffs in dynamic stochastic games, in the case where the length of the period shrinks, but players' rate of time discounting and the transition rate between states remain fixed.

We present a meaningful definition of the feasible and individually rational payoff sets for this environment, and we prove a folk theorem under imperfect. In this case, the discounting between periods shrinks to zero in the limit, but the discounting of the expected time until a state transition does not.

Our main result is a folk theorem that holds under Fudenberg, Levine, and Maskin’s () monitoring conditions. We do not require that the stochastic game be irreducible. a failure of lower hemicontinuity) where the discount factor, 6, equals one, as we show in Example 3.

Nonetheless the games in which discontinuities occur are quite degenerate, and, in the end, we can give a qualified "yes" (Theorem 2) to the question of whether the Folk Theorem holds with discounting. In particular, it always holds in two.

Section 2 presents the classical Folk Theorem and the Aumann-Shapley/ Rubin- stein and Friedman variants. Section 3 discusses continuity of the equilibrium correspondence as a function of the discount factor and develops Folk Theorems for infinitely repeated games with discounting.

Section 4 provides a. Dutta, P. () A folk theorem for stochastic games. Journal of Economic Theory 1–32 Fudenberg, D., Maskin, E. () The folk theorem in repeated games with discounting or with incomplete information.

Econometrica – Google Scholar. Fudenberg, D. and Maskin, E. [] On the dispensability of public randomization in discounted repeated games, J. Econ. The – Crossref, ISI, Google Scholar; Fudenberg, D.

and Maskin, E. [] The folk theorem in repeated games with discounting or with incomplete information, Econometr – Downloadable (with restrictions). In obtaining the celebrated folk theorem, not only everyone must value his future sufficiently high, but also everyone must be perceived so by the others.

This common perception of players' time preferences must be maintained even after someone deviates. This paper explores the implications of myopic perception in repeated games with perfect monitoring.

CiteSeerX - Document Details (Isaac Councill, Lee Giles, Pradeep Teregowda): Abstract. We characterize perfect public equilibrium payoffs in dynamic stochas-tic games, in the case where the length of the period shrinks, but players ’ rate of time discounting and the transition rate between states remain fixed.

We present a meaningful definition of the feasible and individually rational. We study the limit of equilibrium payoffs, as the discount factor goes to one, in non-zero-sum stochastic games. We first show that the set of stationary equilibrium payoffs always converges.

We then provide two-player examples in which the whole set of equilibrium payoffs diverges.stochastic game has a Nash equilibrium A payoff profile is feasible if it is a convex combination of the outcomes in a game, where the coefficients are rational numbers There’s a folk theorem similar to the one for repeated games: If (p 1,p 2) is a feasible pair of payoffs such that each p i is at least as big.establishes a folk theorem for these irreducible stochastic games.

This paper introduces the class of stochastic games with imperfect public mon-itoring, where players observe the state and public signal that is related to the actions played, and shows that when the game is irreducible the folk theorem .