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Potential Differential Games

Alejandra Fonseca-Morales () and Onésimo Hernández-Lerma ()
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Alejandra Fonseca-Morales: CINVESTAV-IPN
Onésimo Hernández-Lerma: CINVESTAV-IPN

Dynamic Games and Applications, 2018, vol. 8, issue 2, No 3, 254-279

Abstract: Abstract This paper introduces the notion of a potential differential game (PDG), which roughly put is a noncooperative differential game to which we can associate an optimal control problem (OCP) whose solutions are Nash equilibria for the original game. If this is the case, there are two immediate consequences. Firstly, finding Nash equilibria for the game is greatly simplified, because it is a lot easier to deal with an OCP than with the original game itself. Secondly, the Nash equilibria obtained from the associated OCP are automatically “pure” (or deterministic) rather than “mixed” (or randomized). We restrict ourselves to open-loop differential games. We propose two different approaches to identify a PDG and to construct a corresponding OCP. As an application, we consider a PDG with a certain turnpike property that is obtained from results for the associated OCP. We illustrate our results with a variety of examples.

Keywords: Differential games; Nash equilibria; Potential games; Optimal control; Maximum principle; 91A23; 91A10; 49N70; 49N90; 34H05 (search for similar items in EconPapers)
Date: 2018
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DOI: 10.1007/s13235-017-0218-6

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Handle: RePEc:spr:dyngam:v:8:y:2018:i:2:d:10.1007_s13235-017-0218-6