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A Finite Characterization of Perfect Equilibria

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  • Ivonne Callejas
  • Srihari Govindan
  • Lucas Pahl

Abstract

Govindan and Klumpp [7] provided a characterization of perfect equilibria using Lexicographic Probability Systems (LPSs). Their characterization was essentially finite in that they showed that there exists a finite bound on the number of levels in the LPS, but they did not compute it explicitly. In this note, we draw on two recent developments in Real Algebraic Geometry to obtain a formula for this bound.

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  • Ivonne Callejas & Srihari Govindan & Lucas Pahl, 2021. "A Finite Characterization of Perfect Equilibria," Papers 2111.01638, arXiv.org.
    • Handle: RePEc:arx:papers:2111.01638
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    References listed on IDEAS

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    1. Ruchira Datta, 2010. "Finding all Nash equilibria of a finite game using polynomial algebra," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 42(1), pages 55-96, January.
    2. Kohlberg, Elon & Mertens, Jean-Francois, 1986. "On the Strategic Stability of Equilibria," Econometrica, Econometric Society, vol. 54(5), pages 1003-1037, September.
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