Perfect correlated equilibria in stopping games

Heller, Yuval (2009): Perfect correlated equilibria in stopping games.

Abstract

In many situations, such as trade in stock exchanges, agents have many instances to act even though the duration of interactions take a relatively short time. The agents in such situations can often coordinate their actions in advance, but coordination during the game consumes too much time. An equilibrium in such situations has to be sequential in order to handle mistakes made by players. In this paper, we present a new solution concept for infinite-horizon dynamic games, which is appropriate for such situations: a sequential constant-expectation normal-form correlated approximate equilibrium. Under additional assumptions, we show that every such game admits this kind of equilibrium.

• Item Type: MPRA Paper
• Language: English
• Keywords: stochastic games, stopping games, correlated equilibrium, sequential equilibrium, Ramsey Theorem, distribution equilibrium
• Subjects: C - Mathematical and Quantitative Methods > C7 - Game Theory and Bargaining Theory > C73 - Stochastic and Dynamic Games ; Evolutionary Games ; Repeated Games

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