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Newtonian Mechanics And Nash Play

Author

Listed:
  • S. D. FLÅM

    (University of Bergen, Norway)

  • J. MORGAN

    (Dipartimento di Matematica e Statistica, Universita di Napoli, "Federico II", 80126, Italy)

Abstract

Nash equilibrium leaves the impression that each player foresees perfectly and responds optimally. Must human-like, rational agents really acquire both these faculties? This paper argues that in some instances neither is ever needed. For the argument repeated play is modelled here as a constrained, decentralized, second-order process driven by noncoordinated pursuit of better payoffs. Some friction feeds into — and stabilizes — a fairly myopic mode of behavior. Convergence to equilibrium therefore obtains under weak and natural conditions. An important condition is that accumulation of marginal payoffs, along the path of play, yields a sum which is bounded above.

Suggested Citation

  • S. D. Flåm & J. Morgan, 2004. "Newtonian Mechanics And Nash Play," International Game Theory Review (IGTR), World Scientific Publishing Co. Pte. Ltd., vol. 6(02), pages 181-194.
    • Handle: RePEc:wsi:igtrxx:v:06:y:2004:i:02:n:s0219198904000149
    DOI: 10.1142/S0219198904000149
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    References listed on IDEAS

    as
    1. Fudenberg, Drew & Levine, David, 1998. "Learning in games," European Economic Review, Elsevier, vol. 42(3-5), pages 631-639, May.
    2. Drew Fudenberg & David K. Levine, 1998. "The Theory of Learning in Games," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262061945, April.
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    Citations

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    Cited by:

    1. Laraki, Rida & Mertikopoulos, Panayotis, 2013. "Higher order game dynamics," Journal of Economic Theory, Elsevier, vol. 148(6), pages 2666-2695.
    2. Berglann, Helge & Flåm, Sjur Didrik, 2002. "Stochastic Approximation, Momentum, and Nash Play," Working Papers in Economics 09/02, University of Bergen, Department of Economics.
    3. Jonathan Newton, 2018. "Evolutionary Game Theory: A Renaissance," Games, MDPI, vol. 9(2), pages 1-67, May.
    4. Sjur Didrik Flåm, 2002. "Convexity, Differential Equations, and Games," CESifo Working Paper Series 655, CESifo.

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    More about this item

    Keywords

    Noncooperative games; Nash equilibrium; repeated play; differential equations; Newtonian mechanics; energy dissipation; stochastic approximation; JEL classification C72;
    All these keywords.

    JEL classification:

    • B4 - Schools of Economic Thought and Methodology - - Economic Methodology
    • C0 - Mathematical and Quantitative Methods - - General
    • C6 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling
    • C7 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory
    • D5 - Microeconomics - - General Equilibrium and Disequilibrium
    • D7 - Microeconomics - - Analysis of Collective Decision-Making
    • M2 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Economics

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