The target projection dynamic

E. Tsakas; Mark  Voorneveld

doi:10.1016/j.geb.2009.01.003

The target projection dynamic

E. Tsakas^*, Mark Voorneveld ^*

^*Corresponding author for this work

Microeconomics & Public Economics

Research output: Contribution to journal › Article › Academic › peer-review

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.

Original language	English
Pages (from-to)	708-719
Number of pages	12
Journal	Games and Economic Behavior
Volume	67
Issue number	2
DOIs	https://doi.org/10.1016/j.geb.2009.01.003
Publication status	Published - 1 Jan 2009

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10.1016/j.geb.2009.01.003

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AB - 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.

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