The Price of History-Independent Strategies in Games with Inter-Temporal Externalities

Yevgeny Tsodikovich (), Xavier Venel () and Anna Zseleva ()
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Yevgeny Tsodikovich: Bar Ilan University
Xavier Venel: LUISS
Anna Zseleva: Maastricht University

Dynamic Games and Applications, 2024, vol. 14, issue 5, No 9, 1317-1332

Abstract: Abstract In this paper, we compare the value of zero-sum stochastic games under optimal strategies (that are, for single-controller stochastic games, stationary) to the commonly used time-independent strategies (“static strategies”). Our findings are summarized in a series of theorems which provide the lower bound on the optimality of the static strategy under different assumptions. These bounds can be used to assess whether the additional computational complexity is worth the extra payoff gain or, symmetrically, assess the price of playing sub-optimal but simple strategies when stationary ones are forbidden.

Keywords: Switching costs; Repeated games; Stochastic games; Zero-sum games; C72; C73 (search for similar items in EconPapers)
Date: 2024
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DOI: 10.1007/s13235-024-00555-w

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