What does the folk theorem reveal about players?
One folk theorem says that, in the infinitely repeated version of the game, provided players are sufficiently patient, there is a Nash equilibrium such that both players cooperate on the equilibrium path.
What is discount factor in game theory?
• The discount factor (折现因子)δ (0 ≤ δ ≤ 1) denotes how. much a future payoff is valued at the current period, or how patient a player is. ◃ If a player has a δ of . 8, then $100 tomorrow is equivalent to $80 today for her.
What is Nash reversion?
Nash Reversion. • The strategies that call for each player i to play his stage game Nash. equilibrium action in every period, regardless of the prior history of play, constitute an SPNE for any value of δ < 1. • A strategy profite in an infinitely repeated game is one of Nash reversion.
Are average payoffs v1 0.4 1.1 in the convex hull of average payoffs?
In the last stage the players must play the unique Nash equilibrium of that game. If such a game is played T times in a row as a finitely repeated game, then there will be a unique SPE that is the repetition of the static non-cooperative Nash equilibrium play in every stage.
What is the repeated game in economics?
Repeated games allow for the study of the interaction between immediate gains and long-term incentives. A finitely repeated game is a game in which the same one-shot stage game is played repeatedly over a number of discrete time periods, or rounds.
What is a trigger strategy in game theory?
From Wikipedia, the free encyclopedia. In game theory, a trigger strategy is any of a class of strategies employed in a repeated non-cooperative game. A player using a trigger strategy initially cooperates but punishes the opponent if a certain level of defection (i.e., the trigger) is observed.
What is a grim trigger strategy in a two firm repeated game?
In the grim trigger strategy, a player cooperates in the first round and in the subsequent rounds as long as his opponent does not defect from the agreement. Once the player finds that the opponent has betrayed in the previous game, he will then defect forever.
What is an infinite game in game theory?
An infinite game is defined as known and unknown players, the rules are changeable, and the objective is not to win—the objective is to keep playing, keep perpetuating the game. When you pit a finite player against a finite player, the system is stable.
What is the important distinction for a game to be considered an infinitely repeated game?
Finitely vs infinitely repeated games Infinite games are those in which the game is being played an infinite number of times. A game with an infinite number of rounds is also equivalent (in terms of strategies to play) to a game in which the players in the game do not know for how many rounds the game is being played.
