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Evolution of Consistent Conjectures in Semi-Aggregative Representation of Games, with Applications to Public Good Games and Contests

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  • Alex Possajennikov

    (School of Economics, University of Nottingham)

Abstract

In a semi-aggregative representation of a game, the payoff of a player depends on a player's own strategy and on a personalized aggregate of all players' strategies. Suppose that each player has a conjecture about the reaction of the personalized aggregate to a change in the player's own strategy. The players play an equilibrium given their conjectures, and evolution selects conjectures that lead to a higher payoff in such an equilibrium. Considering one player role, I show that for any conjectures of the other players, only conjectures that are consistent can be evolutionarily stable, where consistency means that the conjecture is, to a first approximation, correct at equilibrium. I illustrate this result in public good games and contests.

Suggested Citation

  • Alex Possajennikov, 2016. "Evolution of Consistent Conjectures in Semi-Aggregative Representation of Games, with Applications to Public Good Games and Contests," Discussion Papers 2016-08, The Centre for Decision Research and Experimental Economics, School of Economics, University of Nottingham.
    • Handle: RePEc:not:notcdx:2016-08
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    References listed on IDEAS

    as
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    6. Jun–ichi Itaya & Makoto Okamura, 2003. "Conjectural Variations and Voluntary Public Good Provision in a Repeated Game Setting," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 5(1), pages 51-66, January.
    7. Cornes,Richard & Sandler,Todd, 1996. "The Theory of Externalities, Public Goods, and Club Goods," Cambridge Books, Cambridge University Press, number 9780521477185, January.
    8. Possajennikov, Alex, 2015. "Conjectural variations in aggregative games: An evolutionary perspective," Mathematical Social Sciences, Elsevier, vol. 77(C), pages 55-61.
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    Keywords

    semi-aggregative games; conjectural variations; evolutionary stability; public good games; contests;
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