Abstract
Learning processes with bounded recall and fictitious play are studied in 2 × 2 coordination games. It is shown that such learning processes never converge to a risk-dominated equilibrium, and fictitious play always converges to the risk-dominant equilibrium. Memory could be a source of risk-aversion, and certain asymmetry of bounded rationality across players could be a source of stability.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
