Ex-post regret learning in games with fixed and random matching: The case of private values
Rene Saran (r.saran@maastrichtuniversity.nl) and
Roberto Serrano
No 2010-11, Working Papers from Instituto Madrileño de Estudios Avanzados (IMDEA) Ciencias Sociales
Abstract:
In contexts in which players have no priors, we analyze a learning process based on ex-post regret as a guide to understand how to play games of incomplete information under private values. The conclusions depend on whether players interact within a fixed set (fixed matching) or they are randomly matched to play the game (random matching). The relevant long run predictions are minimal sets that are closed under “the same or better reply” operations. Under additional assumptions in each case, the prediction boils down to pure Nash equilibria, pure ex-post equilibria or pure minimax regret equilibria. These three paradigms exhibit nice robustness properties in the sense that they are independent of beliefs about the exogenous uncertainty of type spaces. The results are illustrated in second-price auctions, first-price auctions and Bertrand duopolies.
Keywords: fixed and random matching; incomplete information; ex-post regret learning; nash equilibrium; ex-post equilibrium; minimax regret equilibrium; second-price auction; first-price auction; bertrand duopoly (search for similar items in EconPapers)
JEL-codes: C72 C73 D43 D44 D82 D83 (search for similar items in EconPapers)
Date: 2010-06-08
New Economics Papers: this item is included in nep-cta and nep-gth
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Citations: View citations in EconPapers (6)
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Working Paper: Ex-Post Regret Learning in Games with Fixed and Random Matching: The Case of Private Values (2010) ![Downloads](/downloads_econpapers.gif)
Working Paper: Ex-Post Regret Learning in Games with Fixed and Random Matching: The Case of Private Values (2010) ![Downloads](/downloads_econpapers.gif)
Working Paper: Ex-Post regret learning in games with fixed and random matching: the case of private values (2010) ![Downloads](/downloads_econpapers.gif)
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