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An axiomatization of plays in repeated games

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  • Mathevet, Laurent

Abstract

Suppose that, in repeated games, players eventually engage in a pattern of action profiles, which we call a convention. Do some conventions seem more plausible than others? We answer axiomatically based on the principles of stability and efficient simplicity. The main solution says that conventions should be constant repetitions of a static Nash equilibrium, or such that players switch between two Pareto unranked profiles (across which they each change action). In some repeated games, this reduces the multiplicity of outcomes and even leads to uniqueness. The paper also reports experimental evidence that supports our findings.

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  • Mathevet, Laurent, 2018. "An axiomatization of plays in repeated games," Games and Economic Behavior, Elsevier, vol. 110(C), pages 19-31.
    • Handle: RePEc:eee:gamebe:v:110:y:2018:i:c:p:19-31
    DOI: 10.1016/j.geb.2018.03.012
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    References listed on IDEAS

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    More about this item

    Keywords

    Conventions; Axioms; Pattern mining; Complexity; Stability; Evolution; Equilibrium selection;
    All these keywords.

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • C73 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Stochastic and Dynamic Games; Evolutionary Games
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
    • C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior

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