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on Game Theory |
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Issue of 2011‒07‒02
seven papers chosen by Laszlo A. Koczy Hungarian Academy of Sciences and Obuda University |
| By: | Lauermann, Stephan |
| Abstract: | This paper presents a new characterization result for competitive allocations in quasilinear economies. This result is informed by the analysis of non-cooperative dynamic search and bargaining games. Such games provide models of decentralized markets with trading frictions. A central objective of this literature is to investigate how equilibrium outcomes depend on the level of the frictions. In particular, does the trading outcome become Walrasian when frictions become small? Existing specifications of such games provide divergent answers. The characterization result is used to investigate what causes these differences and to generalize insights from the analysis of specific search and bargaining games. |
| Keywords: | Dynamic Matching and Bargaining; Decentralized Markets; Non-cooperative Foundations of Competitive Equilibrium; Search Theory |
| JEL: | D82 D83 |
| Date: | 2011–03–11 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:31717&r=gth |
| By: | James A. Best |
| Abstract: | In this paper, I look at the interaction between social learning and cooperative behavior. I model this using a social dilemma game with publicly observed sequential actions and asymmetric information about payoffs. I find that some informed agents in this model act, individually and without collusion, to conceal the privately optimal action. Because the privately optimal action is socially costly the behavior of informed agents can lead to a Pareto improvement in a social dilemma. In my model I show that it is possible to get cooperative behavior if information is restricted to a small but non-zero proportion of the population. Moreover, such cooperative behavior occurs in a nite setting where it is public knowledge which agent will act last. The proportion of cooperative agents within the population can be made arbitrarily close to 1 by increasing the infinite number of agents playing the game. Finally, I show that under a broad set of conditions that it is a Pareto improvement on a corner value, in the ex-ante welfare sense, for an interior proportion of the population to be informed. |
| Keywords: | Asymmetric information, cooperation, efficiency, social learning, social dilemmas. |
| JEL: | C72 D62 D82 D83 |
| Date: | 2011–06–24 |
| URL: | http://d.repec.org/n?u=RePEc:edn:esedps:206&r=gth |
| By: | Reinoud Joosten |
| Abstract: | Agents interacting on a body of water choose between technologies to catch Â…fish. One is harmless to the resource, as it allows full recovery; the other yields high immediate catches, but low(er) future catches.Â… Strategic interaction in one 'objective' resource game may induceÂ…Â…Â…Â…Â…Â… several 'subjective' games in the class of social dilemmas. Which unique 'subjective' game is actually played depends crucially on how the agents discount their future payoffs. We examine equilibrium behavior and its consequences on sustainability of the common-pool resource system under exponential and hyperbolic discounting. A suffcient degree of patience on behalf of the agents may lead to equilibrium behavior averting exhaustion of the resource, though full restraint (both agents choosing the ecologically or environmentally sound technology) is not necessarily achieved. Furthermore, if the degree of patience between agents is suffciently dissimilar, the more patient is exploited by the less patient one in equilibrium. We demonstrate the generalizability of our approach developed throughout the paper. We provide recommendations to reduce the enormous complexity surrounding the general cases. |
| Keywords: | stochastic renewable resource games, hyperbolic & exponential discounting, social dilemmas, sustainability Length 30 pages |
| JEL: | C72 C73 Q22 Q57 |
| Date: | 2011–06–14 |
| URL: | http://d.repec.org/n?u=RePEc:esi:evopap:2011-09&r=gth |
| By: | Carmen Beviá; Luis C. Corchón |
| Abstract: | In this paper we study a two stage contest where the strength of players in the second stage depends on the result of the contest in the first stage. We show that this contest displays properties that are not present in one shot contests. Non-symmetric players make different efforts in the first stage and rent dissipation in the first period may be large. We study the conditions under which the discouragement effect holds. In addition, new issues emerge like the evolution of the strengths and the shares of the prize during the game. |
| Date: | 2011–06 |
| URL: | http://d.repec.org/n?u=RePEc:cte:werepe:we1113&r=gth |
| By: | László Á. Kóczy (Óbuda University); Miklós Pintér (Corvinus University) |
| Abstract: | Voting power in voting situations is measured by the probability of changing decisions by altering the cast `yes' or `no' votes. Recently this analysis has been extended by strategic abstention. Abstention, just as `yes' or `no' votes can change decisions. This theory is often applied to weighted voting situations, where voters can cast multiple votes. Measuring the power of a party in a national assembly seems to fit this model, but in fact its power comprises of votes of individual representatives each having a single vote. These representatives may vote yes or no, or may abstain, but in some cases they are not even there to vote. We look at absentees not due to a conscious decision, but due to illness, for instance. Formally voters will be absent, say, ill, with a certain probability and only present otherwise. As in general not all voters will be present, a thin majority may quickly melt away making a coalition that is winning in theory a losing one in practice. A simple model allows us to differentiate between winning and more winning and losing and less losing coalitions reflected by a voting game that is not any more simple. We use data from Scotland, Hungary and a number of other countries both to illustrate the relation of theoretical and effective power and show our results working in the practice. |
| Keywords: | a priori voting power; power index; being absent from voting; minority; Shapley-Shubik index; Shapley value; a priori voting power; power index; being absent from voting; minority; Shapley-Shubik index; Shapley value |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:pkk:wpaper:1104.rdf&r=gth |
| By: | Damien Besancenot (CEPN - Centre d'Economie de l'Université Paris Nord - Université Paris-Nord - Paris XIII - CNRS : UMR7234); Radu Vranceanu (Economics Department - ESSEC Business School) |
| Abstract: | This paper brings experimental evidence on investors' behavior subject to an "illiquidity" constraint, where the success of a risky project depends on the participation of a minimum number of investors. The experiment is set up as a frameless coordination game that replicates the investment context. Results confirm the insidious nature of the illiquidity risk: as long as a first illiquidity default does not occur, investors do not seem able to fully internalize it. After several defaults, agents manage to coordinate on a default probability above which they refuse to participate to the project. This default probability is lower than the default probability of the first illiquidity default. |
| Keywords: | Coordination game, Illiquidity risk, Threshold strategy, Experimental economics |
| Date: | 2011–06–21 |
| URL: | http://d.repec.org/n?u=RePEc:hal:cepnwp:halshs-00602107&r=gth |
| By: | Arnaud Dragicevic; Jim Engle-Warnick |
| Abstract: | Agents face an ambiguous risk of biodiversity survival as well as ambiguous expected losses from its extinction. As a collectivity, agents are faced with the option of privately funding the protection of biodiversity for biomedical research. We propose two evolutionary models of threshold public goods game and public goods option market, where we consider population dynamics with proportional fair-share contributors versus free-riders. In the first model, we find that agents contribute both in null and ambiguous survival scenarios. In the second model, in case of ambiguous survival, the public good is provided when the agents exchanging option contracts are equally divided into buyers and sellers. This result holds for a specific market belief over the species survival. However, the absence of surplus captured on the option market condemns its raison d’être. Low risk will provoke unconditional social free-riding in both models. <P>Les agents font face à un risque ambigu quant à la survie de la biodiversité ainsi qu’à des pertes espérées ambiguës de par leur extinction. En tant que collectivité, les agents ont la possibilité de financer, à titre privé, la protection de la biodiversité à des fins de recherche biomédicale. Nous proposons deux modèles évolutionnaires de jeu du bien public avec seuil et de marché des options sur bien public, où nous considérons la dynamique des populations composées de contributeurs – à hauteur de leur juste part proportionnelle – et de passagers clandestins. Dans le premier modèle, nos résultats montrent que les agents contribuent aussi bien dans les scénarios de survie nulle que de survie ambiguë. Dans le second modèle, le bien public est fourni lorsque les agents négociant les contrats d’options sont identiquement divisés entre acheteurs et vendeurs. Ce résultat se vérifie pour une croyance spécifique du marché sur la survie des espèces. Néanmoins, l’absence de surplus capté sur le marché des options condamne sa raison d’être. Un risque faible provoquera un comportement de passager clandestin inconditionnel dans les deux modèles. |
| Keywords: | biodiversity, ambiguity, threshold public goods, option markets, prediction markets, evolutionary game theory, biodiversité, ambiguïté, biens publics avec seuil, marchés d’options, marchés de prédiction, théorie des jeux évolutionnaires |
| JEL: | C73 D81 H41 Q57 |
| Date: | 2011–06–01 |
| URL: | http://d.repec.org/n?u=RePEc:cir:cirwor:2011s-50&r=gth |