Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/117957
Authors: 
Cartwright, Edward
Year of Publication: 
2004
Series/Report no.: 
Nota di Lavoro, Fondazione Eni Enrico Mattei 85.2004
Abstract: 
We illustrate one way in which a population of boundedly rational individuals can learn to play an approximate Nash equilibrium. Players are assumed to make strategy choices using a combination of imitation and innovation. We begin by looking at an imitation dynamic and provide conditions under which play evolves to an imitation equilibrium; convergence is conditional on the network of social interaction. We then illustrate, through example, how imitation and innovation can complement each other; in particular, we demonstrate how imitation can .help. a population to learn to play a Nash equilibrium where more rational methods do not. This leads to our main result in which we provide a general class of large game for which the imitation with innovation dynamic almost surely converges to an approximate Nash, imitation equilibrium.
Subjects: 
Imitation
Best replay
Convergence
Nash equilibrium
JEL: 
C70
C72
C73
Document Type: 
Working Paper

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