Stationary equilibrium in stochastic dynamic models: Semi-Markov strategies

Subir K. Chakrabarti ()
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Subir K. Chakrabarti: Indiana University Purdue University Indianapolis(IUPUI)

Economic Theory Bulletin, 2021, vol. 9, issue 2, No 3, 177-194

Abstract: Abstract We show here that a stationary equilibrium in Semi-Markov strategies exists for stochastic games under just the condition of norm continuity of the transition probability that are absolutely continuous with respect to a fixed measure on the state space. We also show that the result can be extended to the case of generalized games in which the feasible action correspondences depend on the action of the other players. We show that the generalization allows one to directly apply the results to general dynamic models.

Keywords: Stochastic games; Markov perfect equilibrium; Semi-Markov strategies; Stationary Markov equilibrium; Subgame perfect equilibrium; Stationary semi-Markov perfect equilibrium; Almost Markov perfect equilibrium (search for similar items in EconPapers)
JEL-codes: C61 C62 C7 C72 C73 D81 (search for similar items in EconPapers)
Date: 2021
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DOI: 10.1007/s40505-021-00202-2

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