Article ID Journal Published Year Pages File Type
5072762 Games and Economic Behavior 2009 12 Pages PDF
Abstract

We study the target projection dynamic, a model of learning in normal form games. The dynamic is given a microeconomic foundation in terms of myopic optimization under control costs due to a certain status-quo bias. We establish a number of desirable properties of the dynamic: existence, uniqueness and continuity of solution trajectories, Nash stationarity, positive correlation with payoffs, and innovation. Sufficient conditions are provided under which strictly dominated strategies are wiped out. Finally, some stability results are provided for special classes of games.

Related Topics
Social Sciences and Humanities Economics, Econometrics and Finance Economics and Econometrics
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