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7 - Applications

Published online by Cambridge University Press:  18 March 2010

Paul Weirich
Affiliation:
University of Missouri, Columbia
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Summary

Let us now apply our search procedure for strategic equilibria to various games, first the problem cases for Nash equilibrium presented in Section 3.3, then other cases that bring out the distinctive features of strategic equilibria. Although the standard of strategic equilibrium is much weaker than the standard of Nash equilibrium, it is not empty. It many games it disqualifies some profiles as solutions.

The applications serve mainly to illustrate strategic equilibrium and the search procedure. But they also provide a test of our equilibrium standard. No genuine solution should fail to meet the equilibrium standard. The standard should not disqualify any profile that counts as a solution on firm intuitive grounds or according to firm independent standards for solutions. The applications verify that our equilibrium standard rejects only nonsolutions.

RETURN TO THE PROBLEM CASES

Our equilibrium standard for solutions applies to a concrete game – in the case of a normal-form game, a realization of a payoff matrix. To apply the standard, we construct the complete version of a concrete game and use our search procedure to identify equilibria, assuming that the games treated meet the restrictions Chapter 6 imposes on applications of our search procedure. We typically construct examples starting with a payoff matrix for an ideal normal-form game. Then we introduce the game's partial version, and afterward its complete version, which together provide an account of pursuit of incentives. We construct examples so that group paths conform with the interagent selection and stopping rules, and we generally assume that they conform with all other rules of jointly rational pursuit of incentives.

Type
Chapter
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Equilibrium and Rationality
Game Theory Revised by Decision Rules
, pp. 191 - 210
Publisher: Cambridge University Press
Print publication year: 1998

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  • Applications
  • Paul Weirich, University of Missouri, Columbia
  • Book: Equilibrium and Rationality
  • Online publication: 18 March 2010
  • Chapter DOI: https://doi.org/10.1017/CBO9780511663727.008
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  • Applications
  • Paul Weirich, University of Missouri, Columbia
  • Book: Equilibrium and Rationality
  • Online publication: 18 March 2010
  • Chapter DOI: https://doi.org/10.1017/CBO9780511663727.008
Available formats
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Save book to Google Drive

To save content items to your account, please confirm that you agree to abide by our usage policies. If this is the first time you use this feature, you will be asked to authorise Cambridge Core to connect with your account. Find out more about saving content to Google Drive.

  • Applications
  • Paul Weirich, University of Missouri, Columbia
  • Book: Equilibrium and Rationality
  • Online publication: 18 March 2010
  • Chapter DOI: https://doi.org/10.1017/CBO9780511663727.008
Available formats
×