A folk theorem for minority games
Renault, Jérôme and Scarlatti, Sergio and Scarsini, Marco (2003) A folk theorem for minority games. [Working Paper]. p. 26. ICER Working Papers - Applied Mathematics Series (No. 10-2003).
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We study a particular case of repeated games with public signals. In the stage game an odd number of players have to choose simultaneously one of two rooms. The players who choose the less crowded room receive a reward of one euro (whence the name “minority game”). Between the stages, only the current majority room is publicly announced. We show that in the infinitely repeated game any feasible payo can be achieved as a uniform equilibrium payo , and as an almost sure equilibrium payo . In particular we construct an inefficient equilibrium where, with probability one, all players choose the same room at almost all stages. This equilibrium is sustained by punishment phases which use, in a unusual way, the pure actions that were played before start of the punishment.
|Item Type:||Report / Paper (Working Paper)|
|Research documents and activity classification:||Working Papers > Refereed Working Papers / of international relevance|
|Divisions:||Department of Business and Management|
|Additional Information:||The definitive version of the paper has been published in "Games and Economic Behavior", Vol. 53(2), Pages 208-230, November 2005.|
|Uncontrolled Keywords:||Repeated games; imperfect monitoring; public signals.|
|MIUR Scientific Area:||Area 13 - Economics and Statistics > SECS-S/01 Statistics|
|Deposited By:||Maria Teresa Nistico|
|Deposited On:||21 Dec 2010 11:51|
|Last Modified:||21 Dec 2010 13:00|
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