 WHEN ASPIRING AND RATIONAL AGENTS STRIVE TO COORDINATEInternational Game Theory Review (IGTR), 2007, vol. 09, issue 03, 461-475 Abstract: The paper studies a game of common interest played infinitely many times between two players, one being aspiration driven while the other being a myopic optimizer. It is shown that the only two long run stationary outcomes are the two static equilibrium points. Robustness of long run behavior is studied to show that whenever the optimizer is allowed to make small mistakes, players are able to coordinate on the Pareto dominant equilibrium point most of the time in the long run if the speed of evolution of aspirations is sufficiently fast. However, when only the aspiring player is allowed to make small mistakes, achieving coordination is inevitable and independent of the speed at which aspirations evolve. Keywords: Coordination; evolution of aspiration; myopic optimization; JEL Classification: C72; JEL Classification: D83 (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:wsi:igtrxx:v:09:y:2007:i:03:n:s0219198907001539 Ordering information: This journal article can be ordered from DOI: 10.1142/S0219198907001539 Access Statistics for this article International Game Theory Review (IGTR) is currently edited by David W K Yeung More articles in International Game Theory Review (IGTR) from World Scientific Publishing Co. Pte. Ltd. |
Is your work missing from RePEc? Here is how to contribute.
Questions or problems? Check the EconPapers FAQ or send mail to .
EconPapers is hosted by the
School of Business at Örebro University.