Satisficing and optimality in 2þ2 common interest games

Youngse Kim ()
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Youngse Kim: Department of Economics, Yonsei University, Seoul 120-749, KOREA

Economic Theory, 1999, vol. 13, issue 2, 365-375

Abstract: The paper studies the evolution of cooperation when satisficing players repeatedly play a symmetric two-by-two game of common interest. We show that if initial aspiration levels are sufficiently close to the efficient payoff and aspiration adjusts at a sufficiently slow speed then the unique long run state will be the efficient outcome. In the special case of coordination games, the more tension there is between payoff dominance and risk dominance, the longer it takes for the system to lock into the payoff dominant outcome.

Keywords: Common; interest; ·; Case-based; decision; theory; ·; Aspiration; ·; Payoff; dominance; ·; Risk; dominance. (search for similar items in EconPapers)
JEL-codes: C72 D83 (search for similar items in EconPapers)
Date: 1999-02-17
Note: Received: June 23, 1997; revised version: November 19, 1997
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Citations: View citations in EconPapers (5)

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