scholarly journals Bounded rational response equilibria in human sensorimotor interactions

2021 ◽  
Vol 288 (1962) ◽  
Author(s):  
Cecilia Lindig-León ◽  
Gerrit Schmid ◽  
Daniel A. Braun
Keyword(s):  
Nash Equilibrium ◽  
Nash Equilibria ◽  
Nash Solution ◽  
Quantal Response ◽  
Quantal Response Equilibrium ◽  
Economic Decision Making ◽  
Sensorimotor Interactions ◽  
The Nash Solution ◽  
Special Case ◽  
General Tool

The Nash equilibrium is one of the most central solution concepts to study strategic interactions between multiple players and has recently also been shown to capture sensorimotor interactions between players that are haptically coupled. While previous studies in behavioural economics have shown that systematic deviations from Nash equilibria in economic decision-making can be explained by the more general quantal response equilibria, such deviations have not been reported for the sensorimotor domain. Here we investigate haptically coupled dyads across three different sensorimotor games corresponding to the classic symmetric and asymmetric Prisoner's Dilemma, where the quantal response equilibrium predicts characteristic shifts across the three games, although the Nash equilibrium stays the same. We find that subjects exhibit the predicted deviations from the Nash solution. Furthermore, we show that taking into account subjects' priors for the games, we arrive at a more accurate description of bounded rational response equilibria that can be regarded as a quantal response equilibrium with non-uniform prior. Our results suggest that bounded rational response equilibria provide a general tool to explain sensorimotor interactions that include the Nash equilibrium as a special case in the absence of information processing limitations.

Applications to Political Science

2016 ◽  
Author(s):  
Jacob K. Goeree ◽  
Charles A. Holt ◽  
Thomas R. Palfrey
Keyword(s):  
Political Science ◽  
Threshold Level ◽  
Binary Choice ◽  
Quantal Response ◽  
Quantal Response Equilibrium ◽  
Legislative Bargaining ◽  
Crisis Bargaining ◽  
Volunteer’S Dilemma ◽  
Special Case

This chapter considers a set of closely related binary-choice games that have been applied to model questions in political science. It starts with an analysis of “participation games,” which are n-player games where each player has only two possible actions: to participate or not. The payoff for either decision depends on the number of other players who make that decision. In some cases, a threshold level of participation is required for the group benefit to be obtained. The first example is the “volunteer's dilemma,” which pertains to the special case where the threshold is 1, that is, only a single volunteer is needed. The chapter ends with an analysis of bargaining situations, including an application of agent quantal response equilibrium to bilateral “crisis bargaining” and of Markov QRE to the Baron–Ferejohn model of multilateral “legislative bargaining.”

scholarly journals Stationary Concepts for Experimental 2 × 2 Games: Comment

2011 ◽  
Vol 101 (2) ◽  
pp. 1029-1040 ◽  
Author(s):  
Christoph Brunner ◽  
Colin F Camerer ◽  
Jacob K Goeree
Keyword(s):  
Nash Equilibrium ◽  
Loss Aversion ◽  
The Other ◽  
Quantal Response ◽  
Quantal Response Equilibrium ◽  
Equilibrium Payoff ◽  
Laboratory Results ◽  
Impulse Balance

Reinhard Selten and Thorsten Chmura (2008) recently reported laboratory results for completely mixed 2 X 2 games used to compare Nash equilibrium with four other stationary concepts: quantal response equilibrium, action-sampling equilibrium, payoff-sampling equilibrium, and impulse balance equilibrium. We reanalyze their data, correct some errors, and find that Nash clearly fits worst while the four other concepts perform about equally well. We also report new analysis of other previous experiments that illustrate the importance of the loss aversion hardwired into impulse balance equilibrium: when the other non-Nash concepts are augmented with loss aversion, they outperform impulse balance equilibrium.

scholarly journals Stationary Concepts for Experimental 2x2-Games

2008 ◽  
Vol 98 (3) ◽  
pp. 938-966 ◽  
Author(s):  
Reinhard Selten ◽  
Thorsten Chmura
Keyword(s):  
Nash Equilibrium ◽  
Subject Group ◽  
Quantal Response ◽  
Random Matching ◽  
Quantal Response Equilibrium ◽  
Equilibrium Payoff ◽  
Impulse Balance

Five stationary concepts for completely mixed 2x2-games are experimentally compared: Nash equilibrium, quantal response equilibrium, action-sampling equilibrium, payoff-sampling equilibrium (Martin J. Osborne and Ariel Rubinstein 1998), and impulse balance equilibrium. Experiments on 12 games, 6 constant sum games, and 6 nonconstant sum games were run with 12 independent subject groups for each constant sum game and 6 independent subject groups for each nonconstant sum game. Each independent subject group consisted of four players 1 and four players 2, interacting anonymously over 200 periods with random matching. The comparison of the five theories shows that the order of performance from best to worst is as follows: impulse balance equilibrium, payoff-sampling equilibrium, action-sampling equilibrium, quantal response equilibrium, Nash equilibrium. (JEL C70, C91)

Quantal Response Equilibrium in Extensive-Form Games

2016 ◽  
Author(s):  
Jacob K. Goeree ◽  
Charles A. Holt ◽  
Thomas R. Palfrey
Keyword(s):  
General Theory ◽  
Nash Equilibria ◽  
Final Section ◽  
Quantal Response ◽  
Connected Component ◽  
Extensive Form ◽  
Quantal Response Equilibrium ◽  
Direct Role ◽  
Extensive Form Games ◽  
Unanticipated Consequences

This chapter lays out the general theory of quantal response equilibrium (QRE) for extensive-form games. The formulation of the model is necessarily more complicated because timing and information now play a direct role in the decision maker's choice. This can have interesting and unanticipated consequences. It first describes four possible ways to define QRE in extensive-form games, depending on how the games are represented. It then turns to the structural agent quantal response equilibrium (AQRE) extensive-form games. This is followed by a discussion of the logit AQRE model, which implies a unique selection from the set of Nash equilibria. This selection is defined by the connected component of the logit AQRE correspondence. The final section presents an AQRE analysis of the centipede game.

THE PRICE OF ANARCHY FOR RESTRICTED PARALLEL LINKS

2006 ◽  
Vol 16 (01) ◽  
pp. 117-131 ◽  
Author(s):  
MARTIN GAIRING ◽  
THOMAS LÜCKING ◽  
MARIOS MAVRONICOLAS ◽  
BURKHARD MONIEN
Keyword(s):  
Nash Equilibrium ◽  
System Performance ◽  
Nash Equilibria ◽  
Price Of Anarchy ◽  
Pure Nash Equilibrium ◽  
Worst Case ◽  
Comprehensive Collection ◽  
Parallel Links ◽  
Special Case

In the model of restricted parallel links, n users must be routed on m parallel links under the restriction that the link for each user be chosen from a certain set of allowed links for the user. In a (pure) Nash equilibrium, no user may improve its own Individual Cost (latency) by unilaterally switching to another link from its set of allowed links. The Price of Anarchy is a widely adopted measure of the worst-case loss (relative to optimum) in system performance (maximum latency) incurred in a Nash equilibrium. In this work, we present a comprehensive collection of bounds on Price of Anarchy for the model of restricted parallel links and for the special case of pure Nash equilibria. Specifically, we prove: • For the case of identical users and identical links, the Price of Anarchy is [Formula: see text]. • For the case of identical users, the Price of Anarchy is [Formula: see text]. • For the case of identical links, the Price of Anarchy is [Formula: see text], which is asymptotically tight. • For the most general case of arbitrary users and related links, the Price of Anarchy is at least m – 1 and less than m. The shown bounds reveal the dependence of the Price of Anarchy on n and m for all possible assumptions on users and links.

scholarly journals Quantal Response Equilibrium

2016 ◽  
Author(s):  
Jacob K. Goeree ◽  
Charles A. Holt ◽  
Thomas R. Palfrey
Keyword(s):  
Game Theory ◽  
Nash Equilibrium ◽  
Rational Expectations ◽  
Stochastic Theory ◽  
Quantal Response ◽  
Quantal Response Equilibrium ◽  
Wide Audience ◽  
Science Management ◽  
Classical Game ◽  
Classical Game Theory

This book presents a stochastic theory of games that unites probabilistic choice models developed in psychology and statistics with the Nash equilibrium approach of classical game theory. Nash equilibrium assumes precise and perfect decision making in games, but human behavior is inherently stochastic and people realize that the behavior of others is not perfectly predictable. In contrast, quantal response equilibrium models choice behavior as probabilistic and extends classical game theory into a more realistic and useful framework with broad applications for economics, political science, management, and other social sciences. This book spans the range from basic theoretical foundations to examples of how the principles yield useful predictions and insights in strategic settings, including voting, bargaining, auctions, public goods provision, and more. The approach provides a natural framework for estimating the effects of behavioral factors like altruism, reciprocity, risk aversion, judgment fallacies, and impatience. New theoretical results push the frontiers of models that include heterogeneity, learning, and well-specified behavioral modifications of rational choice and rational expectations. The empirical relevance of the theory is enhanced by discussion of data from controlled laboratory experiments, along with a detailed users' guide for estimation techniques. The book makes pioneering game-theoretic methods and interdisciplinary applications available to a wide audience.

A Refinement of Logit Quantal Response Equilibrium

2018 ◽  
Vol 20 (02) ◽  
pp. 1850004
Author(s):  
Pavlo Blavatskyy
Keyword(s):  
Nash Equilibrium ◽  
Utility Function ◽  
Equilibrium Solution ◽  
Solution Concept ◽  
Affine Transformations ◽  
Quantal Response ◽  
Quantal Response Equilibrium ◽  
Von Neumann ◽  
Proposed Modification ◽  
Simultaneous Move

Unlike the Nash equilibrium, logit quantal response equilibrium is affected by positive affine transformations of players’ von Neumann–Morgenstern utility payoffs. This paper presents a modification of a logit quantal response equilibrium that makes this equilibrium solution concept invariant to arbitrary normalization of utility payoffs. Our proposed modification can be viewed as a refinement of logit quantal response equilibria: instead of obtaining a continuum of equilibria (for different positive affine transformations of utility function) we now obtain only one equilibrium for all possible positive affine transformations of utility function. We define our refinement for simultaneous-move noncooperative games in the normal form.

A Theory of Patronized Goods: Inefficient and Efficient Equilibria

2011 ◽  
pp. 65-87 ◽  
Author(s):  
A. Rubinstein
Keyword(s):  
Nash Equilibrium ◽  
Social Policy ◽  
Nash Equilibria ◽  
Institutional Environment ◽  
Social Motivation ◽  
Pareto Optimal ◽  
Market Failures ◽  
Equilibrium Conditions ◽  
Policy Issues

The article considers some aspects of the patronized goods theory with respect to efficient and inefficient equilibria. The author analyzes specific features of patronized goods as well as their connection with market failures, and conjectures that they are related to the emergence of Pareto-inefficient Nash equilibria. The key problem is the analysis of the opportunities for transforming inefficient Nash equilibrium into Pareto-optimal Nash equilibrium for patronized goods by modifying the institutional environment. The paper analyzes social motivation for institutional modernization and equilibrium conditions in the generalized Wicksell-Lindahl model for patronized goods. The author also considers some applications of patronized goods theory to social policy issues.

scholarly journals Expressiveness and Nash Equilibrium in Iterated Boolean Games

2021 ◽  
Vol 22 (2) ◽  
pp. 1-38
Author(s):  
Julian Gutierrez ◽  
Paul Harrenstein ◽  
Giuseppe Perelli ◽  
Michael Wooldridge
Keyword(s):  
Nash Equilibrium ◽  
Nash Equilibria ◽  
Infinite Sequence ◽  
Multi Agent Systems ◽  
Temporal Logics ◽  
Agent Systems ◽  
Temporal Properties ◽  
Multi Agent ◽  
Game Theoretic ◽  
Boolean Games

We define and investigate a novel notion of expressiveness for temporal logics that is based on game theoretic equilibria of multi-agent systems. We use iterated Boolean games as our abstract model of multi-agent systems [Gutierrez et al. 2013, 2015a]. In such a game, each agent  has a goal  , represented using (a fragment of) Linear Temporal Logic ( ) . The goal  captures agent  ’s preferences, in the sense that the models of  represent system behaviours that would satisfy  . Each player controls a subset of Boolean variables , and at each round in the game, player is at liberty to choose values for variables in any way that she sees fit. Play continues for an infinite sequence of rounds, and so as players act they collectively trace out a model for , which for every player will either satisfy or fail to satisfy their goal. Players are assumed to act strategically, taking into account the goals of other players, in an attempt to bring about computations satisfying their goal. In this setting, we apply the standard game-theoretic concept of (pure) Nash equilibria. The (possibly empty) set of Nash equilibria of an iterated Boolean game can be understood as inducing a set of computations, each computation representing one way the system could evolve if players chose strategies that together constitute a Nash equilibrium. Such a set of equilibrium computations expresses a temporal property—which may or may not be expressible within a particular fragment. The new notion of expressiveness that we formally define and investigate is then as follows: What temporal properties are characterised by the Nash equilibria of games in which agent goals are expressed in specific fragments of  ? We formally define and investigate this notion of expressiveness for a range of fragments. For example, a very natural question is the following: Suppose we have an iterated Boolean game in which every goal is represented using a particular fragment of : is it then always the case that the equilibria of the game can be characterised within ? We show that this is not true in general.

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